CROTON-ON-HUDSON, N.Y. - Croton-Harmon Superintendent Edward Fuhrman may recommend a tax cap override in the 2014-2015 budget.
"We may be looking at an override in (that year) to stay alive," Fuhrman said. "We may face such threats to the credibility of our program that the taxpayers say, 'Whoa, we don't want to dismantle this.' "
One of Fuhrman's major concerns are contributions to the statewide Teachers Retirement System. Each year, the system must make at least an 8 percent return on investment from investments in the stock market or districts make up the shortfall, hence increased contributions since the economic collapse in 2008.
Returns on investment are averaged for a five-year period to inject stability into the districts' contributions. One number in the five-year average, a negative 20.5 percent return on investment from the 2008-2009 fiscal year, still is being averaged into the districts' contributions.
"We need to drop that baby off the cliff," Fuhrman said.
The Croton-Harmon Board of Education is unlikely to seek an override of the tax cap in the 2013-2014 budget year. Fuhrman did not recommend it, and it appears some of the shortfall can be made up through changes in staffing due to declining enrollment in the district.
"I cannot recommend an override this year because we might need one next year," Fuhrman said. "To go out for an override twice is suicide."
School budgets are approved by public vote, a 60 percent supermajority is needed to approve a tax cap override. Although the tax cap is generally referred to as a "2 percent" tax cap, a complex formula handed down by the state provides each district with a unique cap that affects its own tax levy. Croton's taxcap for the 2013-2014 fiscal year is 3.1 percent. The district must reduce $809,000 from its roughly $45 million budget to get below the cap.
The tax levy is the amount of money to be raised through real property taxes. The tax rate is affected by the tax rolls, or the assessed value of property within a district, and the equalization rate, also handed down by the state.
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