School property taxes capped at 2% for 2024-25, comptroller says
With one-time pandemic relief aid nearly exhausted, state Comptroller Thomas DiNapoli said school officials should manage their budgets to comply with the tax cap. Credit: Howard Simmons
Growth in school property taxes on Long Island and statewide will be capped at a maximum 2% for the third year in a row, state Comptroller Thomas DiNapoli announced Thursday.
The latest cap restrictions will apply to school district revenues during the 2024-25 fiscal year, which begins July 1.
Under the state's cap law, in effect since 2012, annual tax hikes for school districts and municipalities are limited to 2% or the inflation rate, whichever is lower. On Long Island, school taxation accounts for more than 60% on average of homeowners' property tax bills.
Inflation rates, while moderating, remain higher than the cap. In December, inflation as measured by the national consumer price index was pegged at 3.4% for the year by the U.S. Bureau of Labor Statistics.
"While inflation continues to decline from recent highs, it remains well above 2%," DiNapoli said. "With one-time pandemic relief aid nearly exhausted, school district and municipal officials should carefully monitor cost growth to effectively manage their budgets and ensure they comply with the tax cap law."
The cap law applies to 676 school districts statewide, including 124 on Long Island, and to 10 cities.
While New York State's limits on property taxes are relatively tight, regional school leaders observe that those limits provide at least some predictability and stability from year to year. Voters in May school elections overwhelmingly approve budgets that remain within the caps, with the result that few budgets have been rejected at the polls in recent years.
"With the tax cap at 2%, that'll send a clear message to schools on what they can expect for their budgets on the tax side," said Bob Vecchio, executive director of the Nassau-Suffolk School Boards Association. "However, that may fall short of covering inflationary costs. School districts will continue to be cautious in their budgets."
Over the past three years, state lawmakers in Albany have approved historic increases in state financial aid for schools, especially for those serving students who are economically disadvantaged. For the current 2023-24 school year, the state aid hike was a little over $3 billion or 9.6%, bringing the statewide total to more than $34 billion.
While the biggest funding boosts are now completed, state assistance is supposed to keep flowing at a more moderate level under a different formula. For the coming year, the state Division of the Budget projects an increase of about $1.3 billion, or 3.8% statewide.
However, the state also faces economic uncertainties and a projected $4.3 billion budget deficit in the coming year.
"Thus, elected officials in the Executive and Legislature may face challenges as they develop the budget," stated a report submitted last month to the Board of Regents, which sets much of the state's educational policy.
Vecchio made a similar observation in a phone interview Thursday, saying it was difficult to predict the coming year's state-aid increase.
"Just because the formula says it should be a certain percent, that doesn't mean that is what the state will allow," he said.
The aid picture should become clearer next week, when Gov. Kathy Hochul is scheduled to release a state budget plan, along with proposals for school district-by-district aid adjustments. Legislators are to approve a final budget by April.
Regional taxpayer advocate Andrea Vecchio, who is not related to Bob Vecchio, said in an interview that the state's tax cap law, while not perfect, had proved a "great accomplishment." She added, however, that districts should strive to hold property tax increases under 2%, and that cost-cutting should be feasible in many local districts where student enrollments have declined.
Vecchio is a founder of Long Islanders for Educational Reform, a regional advocacy group.
"If you were on a school board, and cared as much about the taxpayers and the community as other things, then you could hold tax increases to zero," Vecchio said.
Growth in school property taxes on Long Island and statewide will be capped at a maximum 2% for the third year in a row, state Comptroller Thomas DiNapoli announced Thursday.
The latest cap restrictions will apply to school district revenues during the 2024-25 fiscal year, which begins July 1.
Under the state's cap law, in effect since 2012, annual tax hikes for school districts and municipalities are limited to 2% or the inflation rate, whichever is lower. On Long Island, school taxation accounts for more than 60% on average of homeowners' property tax bills.
Inflation rates, while moderating, remain higher than the cap. In December, inflation as measured by the national consumer price index was pegged at 3.4% for the year by the U.S. Bureau of Labor Statistics.
BY THE NUMBERS
School district tax levy cap over the years
2024-25: 2%
2023-24: 2%
2022-23: 2%
2021-22: 1.23%
2020-21: 1.81%
2019-20: 2%
2018-19: 2%
2017-18: 1.26%
2016-17: 0.12%
2015-16: 1.62%
SOURCE: Office of state Comptroller Thomas DiNapoli
"While inflation continues to decline from recent highs, it remains well above 2%," DiNapoli said. "With one-time pandemic relief aid nearly exhausted, school district and municipal officials should carefully monitor cost growth to effectively manage their budgets and ensure they comply with the tax cap law."
The cap law applies to 676 school districts statewide, including 124 on Long Island, and to 10 cities.
While New York State's limits on property taxes are relatively tight, regional school leaders observe that those limits provide at least some predictability and stability from year to year. Voters in May school elections overwhelmingly approve budgets that remain within the caps, with the result that few budgets have been rejected at the polls in recent years.
"With the tax cap at 2%, that'll send a clear message to schools on what they can expect for their budgets on the tax side," said Bob Vecchio, executive director of the Nassau-Suffolk School Boards Association. "However, that may fall short of covering inflationary costs. School districts will continue to be cautious in their budgets."
Over the past three years, state lawmakers in Albany have approved historic increases in state financial aid for schools, especially for those serving students who are economically disadvantaged. For the current 2023-24 school year, the state aid hike was a little over $3 billion or 9.6%, bringing the statewide total to more than $34 billion.
While the biggest funding boosts are now completed, state assistance is supposed to keep flowing at a more moderate level under a different formula. For the coming year, the state Division of the Budget projects an increase of about $1.3 billion, or 3.8% statewide.
However, the state also faces economic uncertainties and a projected $4.3 billion budget deficit in the coming year.
"Thus, elected officials in the Executive and Legislature may face challenges as they develop the budget," stated a report submitted last month to the Board of Regents, which sets much of the state's educational policy.
Vecchio made a similar observation in a phone interview Thursday, saying it was difficult to predict the coming year's state-aid increase.
"Just because the formula says it should be a certain percent, that doesn't mean that is what the state will allow," he said.
The aid picture should become clearer next week, when Gov. Kathy Hochul is scheduled to release a state budget plan, along with proposals for school district-by-district aid adjustments. Legislators are to approve a final budget by April.
Regional taxpayer advocate Andrea Vecchio, who is not related to Bob Vecchio, said in an interview that the state's tax cap law, while not perfect, had proved a "great accomplishment." She added, however, that districts should strive to hold property tax increases under 2%, and that cost-cutting should be feasible in many local districts where student enrollments have declined.
Vecchio is a founder of Long Islanders for Educational Reform, a regional advocacy group.
"If you were on a school board, and cared as much about the taxpayers and the community as other things, then you could hold tax increases to zero," Vecchio said.
John Hildebrand is Newsday's senior education writer and has covered school news and policy issues affecting Long Island for more than 40 years.
