N.Y.
Education Law Section 2023-A
Limitations upon school district tax levies
1.
Generally. Unless otherwise provided by law, the amount of taxes that may be levied by or on behalf of any school district, other than a city school district of a city with one hundred twenty-five thousand inhabitants or more, shall not exceed the tax levy limit established pursuant to this section, not including any tax levy necessary to support the expenditures pursuant to subparagraphs (i) through (iv) of paragraph i of subdivision two of this section.2.
Definitions. As used in this section:a.
“Allowable levy growth factor” shall be the lesser of:(i)
one and two one-hundredths; or(ii)
the sum of one plus the inflation factor; provided, however, that in no case shall the levy growth factor be less than one.b.
“Available carryover” means the amount by which the tax levy for the prior school year was below the applicable tax levy limit for such school year, if any, but no more than an amount that equals one and one-half percent of the tax levy limit for such school year.c.
“Capital local expenditures” means the taxes associated with budgeted expenditures resulting from the financing, refinancing, acquisition, design, construction, reconstruction, rehabilitation, improvement, furnishing and equipping of, or otherwise providing for school district capital facilities or school district capital equipment, including debt service and lease expenditures, and transportation capital debt service, subject to the approval of the qualified voters where required by law. The commissioner of taxation and finance shall, as appropriate, promulgate rules and regulations which may provide for adjustment of capital local expenditures to reflect a school district’s share of additional budgeted capital expenditures made by a board of cooperative educational services.d.
“Capital tax levy” means the tax levy necessary to support capital local expenditures, if any.e.
“Coming school year” means the school year for which tax levy limits are being determined pursuant to this section.f.
“Inflation factor” means the quotient of:(i)
the average of the national consumer price indexes determined by the United States department of labor for the twelve-month period preceding January first of the current year minus the average of the national consumer price indexes determined by the United States department of labor for the twelve-month period preceding January first of the prior year, divided by:(ii)
the average of the national consumer price indexes determined by the United States department of labor for the twelve-month period preceding January first of the prior year, with the result expressed as a decimal to four places.g.
“Prior school year” means the school year immediately preceding the coming school year.h.
“School district” means a common school district, union free school district, central school district, central high school district or a city school district in a city with less than one hundred twenty-five thousand inhabitants.i.
“Tax levy limit” means the amount of taxes a school district is authorized to levy pursuant to this section, provided, however, that the tax levy limit shall not include the following:(i)
a tax levy necessary for expenditures resulting from court orders or judgments against the school district arising out of tort actions for any amount that exceeds five percent of the total tax levied in the prior school year;(ii)
in years in which the system average actuarial contribution rate of the New York state and local employees’ retirement system, as defined by paragraph ten of subdivision a of Retirement & Social Security Law § 19-A (Employer contributions for the two thousand ten - two thousand eleven fiscal year and subsequent fiscal years)section nineteen-a of the retirement and social security law, increases by more than two percentage points from the previous year, a tax levy necessary for expenditures for the coming fiscal year for school district employer contributions to the New York state and local employees’ retirement system caused by growth in the system average actuarial contribution rate minus two percentage points;(iii)
in years in which the normal contribution rate of the New York state teachers’ retirement system, as defined by paragraph a of subdivision two of § 517 (Annuity reserve fund)section five hundred seventeen of this chapter, increases by more than two percentage points from the previous year, a tax levy necessary for expenditures for the coming fiscal year for school district employer contributions to the New York state teachers’ retirement system caused by growth in the normal contribution rate minus two percentage points; and(iv)
a capital tax levy. 2-a. Tax base growth factor.a.
No later than February fifteenth of each year, the commissioner of taxation and finance shall identify those school districts for which tax base growth factors must be determined for the coming school year, and shall notify the commissioner of the tax base growth factors so determined, if any.b.
The commissioner of taxation and finance shall calculate a quantity change factor for the coming school year for each school district based upon the physical or quantity change, as defined by Real Property Tax Law § 1220 (Definitions)section twelve hundred twenty of the real property tax law, reported to the commissioner of taxation and finance by the assessor or assessors pursuant to Real Property Tax Law § 575 (Assessor’s annual reports)section five hundred seventy-five of the real property tax law. The quantity change factor shall show the percentage by which the full value of the taxable real property in the school district has changed due to physical or quantity change between the second final assessment roll or rolls preceding the final assessment roll or rolls upon which taxes are to be levied, and the final assessment roll or rolls immediately preceding the final assessment roll or rolls upon which taxes are to be levied. The commissioner of taxation and finance shall, as appropriate, promulgate rules and regulations regarding the calculation of the quantity change factor which may adjust the calculation based on the development on tax exempt land.c.
After determining the quantity change factor for a school district, the commissioner of taxation and finance shall proceed as follows:(i)
If the quantity change factor is negative, the commissioner of taxation and finance shall not determine a tax base growth factor for the school district.(ii)
If the quantity change factor is positive, the commissioner of taxation and finance shall determine a tax base growth factor for the school district which is equal to one plus the quantity change factor.3.
Computation of tax levy limits.a.
Each school district shall calculate the tax levy limit for each school year which shall be determined as follows: (1) Ascertain the total amount of taxes levied for the prior school year. (2) Multiply the result by the tax base growth factor, if any. (3) Add any payments in lieu of taxes that were receivable in the prior school year. (4) Subtract the tax levy necessary to support the expenditures pursuant to subparagraphs (i) and (iv) of paragraph i of subdivision two of this section for the prior school year, if any. (5) Multiply the result by the allowable levy growth factor. (6) Subtract any payments in lieu of taxes receivable in the coming fiscal year. (7) Add the available carryover, if any.b.
On or before March first of each year, any school district subject to the provisions of this section shall submit to the state comptroller, the commissioner, and the commissioner of taxation and finance, in a form and manner prescribed by the state comptroller, any information necessary for the calculation of the tax levy limit; and the school district’s determination of the tax levy limit pursuant to this section shall be subject to review by the commissioner and the commissioner of taxation and finance.4.
Reorganized school districts. When two or more school districts reorganize, the commissioner shall determine the tax levy limit for the reorganized school district for the first school year following the reorganization based on the respective tax levy limits of the school districts that formed the reorganized district from the last school year in which they were separate districts, provided that in the event of formation of a new central high school district, the tax levy limits for the new central high school district and its component school districts shall be determined in accordance with a methodology prescribed by the commissioner.5.
Erroneous levies. In the event a school district’s actual tax levy for a given school year exceeds the maximum allowable levy as established pursuant to this section due to clerical or technical errors, the school district shall place the excess amount of the levy in reserve in accordance with such requirements as the state comptroller may prescribe, and shall use such funds and any interest earned thereon to offset the tax levy for the ensuing school year.6.
(a) Notwithstanding any other provision of law to the contrary, in the event the trustee, trustees or board of education of a school district that is subject to the provisions of this section proposes a budget that will require a tax levy that exceeds the tax levy limit for the corresponding school year, not including any levy necessary to support the expenditures pursuant to subparagraphs (i) through (iv) of paragraph i of subdivision two of this section, then such budget shall be approved if sixty percent of the votes cast thereon are in the affirmative. (b) Where the trustee, trustees or board of education proposes a budget subject to the requirements of paragraph (a) of this subdivision, the ballot for such budget shall include the following statement in substantially the same form: “Adoption of this budget requires a tax levy increase of which exceeds the statutory tax levy increase limit of for this school fiscal year and therefore exceeds the state tax cap and must be approved by sixty percent of the qualified voters present and voting.” 7. In the event that the original proposed budget is not approved by the voters, the sole trustee, trustees or board of education may adopt a final budget pursuant to subdivision eight of this section or resubmit to the voters the original or a revised budget at a special district meeting in accordance with subdivision three of section two thousand seven of this part. Upon one defeat of such resubmitted budget, the sole trustee, trustees or board of education shall adopt a final budget pursuant to subdivision eight of this section.8.
Notwithstanding any other provision of law to the contrary, if the qualified voters fail to approve the proposed school district budget upon resubmission or upon a determination not to resubmit for a second vote pursuant to subdivision seven of this section, the sole trustee, trustees or board of education shall levy a tax no greater than the tax that was levied for the prior school year.9.
Nothing in this section shall preclude the trustee, trustees, or board of education of a school district, in their discretion, from submitting additional items of expenditures to the voters for approval as separate propositions or the voters from submitting propositions pursuant to sections two thousand eight and two thousand thirty-five of this part; provided however, except in the case of a proposition submitted for any expenditure contained within subparagraphs (i) through (iv) of paragraph i of subdivision two of this section, if any proposition, or propositions collectively that are subject to a vote on the same date, would require an expenditure of money that would require a tax levy and would result in the tax levy limit being exceeded for the corresponding school year then such proposition shall be approved if sixty percent of the votes cast thereon are in the affirmative.
Source:
Section 2023-A — Limitations upon school district tax levies, https://www.nysenate.gov/legislation/laws/EDN/2023-A (updated Apr. 19, 2019; accessed May 11, 2024).
