BILL NUMBER:S1614

TITLE OF BILL:

An act to amend the real property tax law, in relation to establishing
equalization rates for Greenburgh central school district

PURPOSE OR GENERAL IDEA OF BILL:

To establish a special equalization rate for the Greenburgh central
school district commencing in the 2015-2016 school year.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1 of the bill amends real property tax law section 1230
subdivision 3, as amended by section 54 part Al of chapter 58 of the
laws of 2006, by adding Greenburgh central school district to the list
of school districts for which special equalization rates have been
established.

Section 2 provides formulas for calculating aid apportioned to
Greenburgh central school district for any project for which aid is
first apportioned pursuant to subdivision 6 of section 3602 of the
education law on or after July 1, 2015; for calculating the selected
building aid ratio-equivalent which shall not be less than zero; and
for calculating the equivalent pupils of the school district.  This
              

section also provides that the office of real property services shall
determine such equivalent actual valuation and it shall be final and
not subject to change on or after July first, two thousand sixteen.

Section 3 defines the effective date as immediately and applies this
act to the 2015-2016 school year.

JUSTIFICATION:

Greenburgh Central School District (the Greenburgh School District)
lies within the unincorporated Town of Greenburgh.  For purposes of
computing Greenburgh School District's state aid to education, the
assessing unit is the Town of Greenburgh and includes the
unincorporated areas of Greenburgh, including Edgemont, a community
with far greater property value and income than the Greenburgh School
District. School-aged children residing in Edgemont attend the
Edgemont Union Free School District (Edgemont School District).

This legislation amends existing law to establish a special
equalization rate for the Greenburgh School District for the purpose
of determining actual valuation to calculate its operating and
building aid.

Under current law education state aid is determined through the use of
equalization rates. A State Equalization Rate is the percentage of
full value at which taxable real property in a county, city, town or
village is assessed as determined by the State Board of Equalization
and Assessment.


This determination assumes assessment at a uniform percentage of
value. Value is computed by dividing the assessed value of taxable
real property within a district by the State Equalization Rate.

Since the equalization rate used in the state aid formula is based on
the actual valuation of the entire unincorporated Town of Greenburgh
including the much wealthier community of Edgemont, the full value of
the property in the Greenburgh School District is overstated thereby
reducing the amount of education aid received by the district.

This legislation is intended to correct this inequitable situation by
calculating the equalization rate based on the total assessed value of
property in the Greenburgh School District only. In addition to
differing property wealth there are many additional reasons that
justify a special equalization rate for the Greenburgh School
District. Income wealth and socio/ethnic diversity in the Greenburgh
School District also differ greatly from the Edgemont School District.

Based on home property values and income, the Edgemont School District
is one of the wealthiest communities in New York State. According to
Multiple Listing Service statistics, the median residential sale price
for the year 2013 was $968,750 in Edgemont compared to $433,000 in the
Greenburgh School District. The median home price in Edgemont is more
than twice the median home price in the Greenburgh School District.
Moreover, the median residential sale price for the year 2013 in
Westchester County was $610,000 which is substantially higher than the
median sale price of a home in the Greenburgh School District but
substantially lower than a home in the Edgemont School District.

Edgemont's median family income ($176,493) is more than twice that of
the Greenburgh Central school's median family income ($87,660).
Edgemont's per capital income ($71,287) is almost twice that of the
Greenburgh School District's ($37,797). An even greater indicator of
the differences between the two communities is reflected in the
percentage of students who receive free/reduced lunch. 51% of
Greenburgh School District's students receive a free/reduced lunch;
Edgemont has 0% students receiving a free/reduced lunch. In addition,
Greenburgh School District's black and Hispanic population is 78%;
Edgemont School District's black and Hispanic population is 5%.

Utilizing an equalization rate based on the combined assessed value of
the Unincorporated Town of Greenburgh is unfair in its treatment of
the Greenburgh School District. The Greenburgh School District, the
poorer district, is penalized by incorporating the wealthier community
of the Edgemont School District's total assessed value into the
Unincorporated Town of Greenburgh's calculation. This method makes the
Greenburgh School District appear wealthier than is actually the case,
thereby lowering its fair share of state aid.

A comparison between The Greenburgh School District and a similar
school district, Tarrytown, confirms the current inequity.
Tarrytown's building aid ratio was 25% from 1996-2001 and 32% from
2001 to the present whereas the Greenburgh School District's has
remained steady at 4.8%.

Moreover, a comparison between the Greenburgh School District and
other wealthy school districts in Westchester County further


exemplifies the inequity of the building state aid received by the
Greenburgh School District. The Scarsdale Union Free School District's
building aid is 9.5%; Bronxville Union Free School District's building
aid is 10.1%; and Chappaqua Central School District's building aid is
23.6%

Precedent for the establishment of special equalization rates for
school districts in similar circumstances as the Greenburgh School
District is firmly established in the law.

In 1983, the then Governor signed into law legislation to require the
State Board of Equalization and Assessment to establish special
equalization rates for the Hempstead and Freeport Union Free School
Districts. The rationale for these special laws was that a "special"
rate should be established for education aid purposes because the
areas encompassed by these school districts were assessed at a higher
ratio of assessed value to market value than the Town of Hempstead as
a whole causing a hardship to these school districts (identical to the
Greenburgh School District situation).

In 1984, Governor Mario Cuomo vetoed special equalization rate bills
for four school districts (Lindenhurst, Amityville, Patchogue-Medford
and Babylon) based upon his objection to a "caseby-case" approach to
this issue and directed the State Board to develop recommendations to
address this issue in a "comprehensive, statewide manner that will
make similar local bills unnecessary."

In 1986, chapter 660 of the Laws of New York State was enacted
establishing a task force to examine the impact of the use of state
equalization rates in the distribution of state aid to education. The
school districts surveyed included 53 districts in Nassau, all or part
of 57 districts in six towns in Suffolk, two districts in Erie and one
district in Albany County. Notably, no Westchester County school
district was included in this study. This task force recommended that
"segment equalization" rates not be established for school districts
because most school districts would not be affected.  Accordingly, the
State could not justify the cost of establishing rates for every
district. The only recourse available for school districts that were
not properly assessed was to enact legislation that would authorize
the State Board to establish a special "segment" equalization rate.
Thus, in 1989 the Legislature passed and Governor Mario Cuomo signed a
law establishing a Special Equalization Rate for each of six school
districts in Nassau and Suffolk Counties:  Uniondale, Westbury,
Central Islip, Brentwood, Wyandanch and Amityville. Significantly,
this legislation established special "segment" equalization rates for
Suffolk County districts despite the fact that there was insufficient
data regarding actual valuation for these school districts. More
recently, in 2006 the Legislature passed and the then Governor signed
a law establishing a Special Equalization Rate for the Tuckahoe School
District in Westchester County due to the fact that its state aid was
unfairly impacted by the wealth of the Village of Bronxville.

The Greenburgh School District is currently in the same situation as
were these Suffolk County districts and the Tuckahoe School District,
over-valued and losing critical state aid dollars. The only way for
the Greenburgh School District to receive its fair share of state aid
is to amend the current law to include the Greenburgh School District


among those districts already provided a special equalization rate.
As set forth above, precedent for this legislation is well
established.

Receiving its fair share of building aid is a critical issue for the
Greenburgh School District at this time. To address growing
enrollment, the increase in mandated courses, implementation of the
Common Core, and the need to update its aging facilities, Greenburgh
is proposing a major construction project that will consolidate all of
the Greenburgh School District's educational programs on a single
campus.

To accomplish this vision, the District would sell two schools, expand
the school already on the 100 acre campus for pre-kindergarten through
second grade; construct a new facility to serve children in grades
three through eight; and renovate the high school which serves
students in ninth through 12th grades. In 2008, a state audit of the
current six buildings in the District showed that it would cost, at
that time, approximately fifty million dollars to bring them up to
code. The projected cost to consolidate all six locations on one
campus is one hundred million dollars. It is estimated that the sale
of the two school properties in the District will range between $2.5
and $5 million and that the consolidation of the District on one
campus will save money by eliminating some administrative positions
and cutting transportation costs. Moreover, the new facilities would
be technologically up to date and incorporate the latest energy-saving
materials.

The construction of these new and improved facilities' is critical to
the continued academic success of the Greenburgh School District. An
increase in building aid will improve the likelihood of getting voter
support for the bond referendum needed for this project.

This legislation will allow the Greenburgh School District to utilize
a special equalization rate to calculate its select aid ratio and help
rectify a long existing inequity in state aid received by the
District.

LEGISLATIVE HISTORY:

2014: S6874-A died in local government;
A8893-B passed assembly

FISCAL IMPLICATIONS:

To be determined

EFFECTIVE DATE:

This act shall take effect immediately.