CAPITAL REGION — The tax cap is working to slow the growth of school taxes, the Empire Center for New York State Policy announced Wednesday in a report analyzing tax levy increases statewide before and after the state imposed the cap.

The cap, enacted in 2011 and taking effect in 2012, essentially discourages districts from increasing the levy more than 2 percent or the rate of inflation, whichever is less. Certain expenses do not count toward the total, however, and a school board can vote to override the cap, so it is not a concrete limit.

The Empire Center, a non-partisan research group, found the average tax levy increase across the state while the cap has been in effect was 2.2 percent. The tax levy is the total amount of money a community must pay to its school district, and a 2.2 percent increase is much lower than the average increase over the previous three decades.

In the Capital Region, tax levies rose an average of 5.4 percent a year before the cap was instituted. The average rate of inflation during that time was 3.3 percent a year, the Empire Center said.

Using the same raw data from the state Comptroller’s Office that the Empire Center used for its research, The Gazette calculated the average annual tax levy increase for most of the school districts in the Capital Region in the 30 years prior to the tax cap, from 1982 to 2012.

The districts with the slowest rate of growth were Schenectady and Johnstown, with 4 percent average annual tax levy increases.

The highest: Ballston Spa, Shenendehowa and Schuylerville, with 8 percent increases on average each year. All three are in Saratoga County, which has seen skyrocketing growth in new residential neighborhoods and commercial development.

Ballston Spa Central School District Superintendent Joseph Dragone pointed to that growth to explain why his district had tax levy increases so much larger than the rest of the Capital Region.

“A larger tax base creates a larger levy,” he said, adding that the school’s enrollment has increased by 30 percent since 1982.

“We were really rural communities. We had to build a new high school,” he said. “The growth in Saratoga County speaks for itself.”

In the Shenendehowa Central School District, Superintendent L. Oliver Robinson also noted that enrollment has grown by nearly 20 percent.

“For many of those years, the Shen community was exploding in size, residentially and commercially,” he said in a statement.

But Robinson said the state also was to blame for tax levy increases. He said state aid did not keep up with Shenendehowa’s growth.

“In the early 1990s, state aid represented 40 percent of the district’s revenues. Today, state aid only accounts for 26 percent of the district revenues,” he said. “For the past five years, we have also dealt with a significant loss in state aid under Gap Elimination Adjustment. The compounding effect of almost $30 million caused an increased reliance on taxes.”

In Schenectady, where the tax levy has grown half as quickly, Superintendent Laurence Spring said the 4 percent annual growth was proof the district didn’t need a tax cap.

“We have a natural tax cap. Thinking about what it is people can afford, that’s our limit,” he said.

He too blamed state funding for a portion of the tax levy increases.

“The reason people think taxes are so high is because property taxpayers are bearing a much larger proportion [of the school expenses] than they should,” he said.

The district receives $62 million less from the state than the state’s own aid formula says it should. If the district was given that aid, Spring said, it would spend $40 million on improvements at the school district and reduce the tax levy by $22 million, or nearly half.

In Johnstown, school officials pointed to different reasons for their low tax levy increases.

“Historically, this school district Board of Education has been very conservative,” said district Business Manager Alice Sise. “They don’t even like to go over 2 percent.”

That’s led the board to push for much lower pay raises than other districts have approved for teachers, she said.

“We’re very careful in our contracts,” she added.

In the past nine years, including the upcoming year, the average tax levy increase for the district has been only 1.81 percent.

But the slow increase has also been pushed by the district’s declining enrollment. The district has closed a school building and not replaced teachers when they retire, cutting its workforce by attrition, she said.

But even with Schenectady’s poverty and Johnstown’s conservative spending, both districts still increased the tax levy by an average of 4 percent a year over the 30-year period. The Empire Center pointed to that data to argue that the tax cap has been effective and should be continued.

“It has definitely been effective at reducing property tax increases,” said Empire Center researcher Ken Girardin.

The cap was instituted by the state on a temporary basis, expiring next year, but the Legislature will debate this year whether to make it permanent. The state Senate has already passed a bill making it permanent, but members of the Assembly are proposing changes.

The Empire Center’s announcement included tweets supporting the tax cap that it encouraged readers to send out. Among them: “School property taxes across NY used to be growing out of control. Not any more, thanks to tax cap initiated in 2012 by @NYGovCuomo.”

But school leaders said they are not pleased with the cap. Ballston Spa’s Dragone said the cap would prevent expensive new school programs.

“If it’s a political priority to cap it, OK, then you’re not going to be able to do those things,” he said. “That is the price.”

Schenectady’s Spring said the tax cap formula did not take into consideration certain costs that rise at an annual rate greater than 2 percent, such as health insurance, although it does make an exception for large jumps in pension costs.

But rather than fix it, Spring said he’d prefer to do away with the entire property tax system. Schools should not be funded by property taxes, he said.

If the system continues, it will reach a point where school taxes are the biggest payment made on a house, he predicted.

“A cap slows it down; it doesn’t stop it,” he said. “There’s an event horizon out there, and you’ll reach it.”

BY THE NUMBERS

The average annual tax levy increase in select Capital Region school districts from 1982 to 2012:

Albany County

Albany 5%

Guilderland 7%

South Colonie 6%

North Colonie 6%

Fulton County

Broadalbin-Perth 6%

Gloversville 5%

Johnstown 4%

Mayfield 7%

Northville 6%

Oppenheim-Ephratah 5%

Wheelerville 5%

Montgomery County

Amsterdam 5%

Canajoharie 5%

Fonda-Fultonville 6%

Fort Plain 6%

St. Johnsville 5%

Saratoga County

Ballston Spa 8%

BH-BL 6%

Galway 6%

Mechanicville 6%

Saratoga Springs 7%

Schuylerville 8%

Shenendehowa 8%

S. Glens Falls 7%

Stillwater 7%

Waterford-Halfmoon 6%

Schenectady County

Duanesburg 7%

Mohonasen 5%

Niskayuna 6%

Schalmont 6%

Schenectady 4%

Scotia-Glenville 6%

Schoharie County

Cobleskill-Richmondville 6%

Middleburgh 6%

Schoharie 7%

Sharon Springs 6%

© 2015 The Daily Gazette