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Schools Rebuke County’s Proposed Assessment Shift

School leaders call on Legislature to fix assessment system, not “shift the burden.”

School leaders came together at Monday's meeting of the County Legislature to protest a proposal to shift a portion of tax certiorari settlements from the County to the individual school districts as part of County Executive Ed Mangano's, R-Bethpage, plan to alleviate a $347 million budget deficit.

"It results in no real cost avoidance but it will reduce the County's lawful responsibility onto the school districts," said Mary Jo O'Hagan, Nassau vice-President of the Nassau-Suffolk School Boards Association.

In 1938 Nassau requested and was granted County-wide jurisdiction over property assessment from the State. Aside from Tompkins County in upstate New York, Nassau is the only county with such privileges, and with over 400,000 parcels of land, Nassau is second only to New York City in terms of size.

Wary of concerns over the possibility of false assessments, the State Legislature decided that Nassau would be responsible for both refunds and revenues associated with false assessments, a charge the County pledged to uphold.

"Legal challenges to commercial assessments have been either negligently or willfully permitted to languish in the courts for years and years accruing interest at exorbitant rates prior to their eventual settlement by the County," O'Hagan, a Baldwin school board member, said.

It is estimated that the school portion of the certiorari settlements account for approximately 20-percent of the total refunds, or $80 million.

"If the problem is $80 million according to the County Executive, and that $80 million is going to be shifted from the County to the schools, it's a whopping tax increase because the County's not giving back that $80 million," Legislator Dave Denenberg, D-Merrick, said.

"If this goes through, and if the tax burden was $80 million, there is no $80 million to refund," Presiding officer Peter Schmitt, R-Massapequa, said. "Mr. Denenberg should know since he's voted for each and every year since 2003 - the $80 million is bonded money, so if you're not bonding you don't have any cash, you don't have any debt, so there's nothing to return."

Denenberg shot back saying that the Mangano administration had decided to "100-percent" bond for tax refunds. "That was not the policy the last several years."

The proposed law would not take effect until 2013, at which time Schmitt said "that the 8 million figure will be substantially reduced because the assessment reforms that are taking place will have cleared up the backlog."

"I don't believe the County's going to decrease taxes, by the percentage, whatever we say," Kevin Abrahams, D-Hempstead, said to O'Hagan. "I don't believe the County is going to lower taxes by that amount however I do believe that you're going to have to raise taxes."

School districts contend that they would have to create a local office of assessment as well a fund to handle refunds from their own certiorari settlements.

"Our local school districts' business offices are ill-equipped to assess," Roslyn school board president Meryl Waxman Ben-Levy said. "We are looking to consolidate back office functions that don't relinquish local control for the delivery of education, looking to save and cut where we can. Shall we suggest that we're creating assessment offices in local school districts now and all that that would entail by support staff and administrative staff and legal staff?"

Denenberg did not believe the County could unilaterally eliminate the guarantee and would need State approval.

"What it's going to do, if it ever happens, would be to lessen the amount of bonded debt the County's paying out," Judy Jacobs, D-Woodbury, said.

O'Hagan said there was "no question" that taxes on the local level would increase "if the County's problem becomes the problem of the local school districts," and "where there's a far narrower stream of revenue."

Merrick superintendent and President of the Nassau County council of superintendents Dr. Ranier Melucci estimated that an overpayment of $36 million currently exists for commercial property owners in Nassau.  Divided among the 56 school districts, this results in an average liability of $640,000 per district. "This is an average, and many districts will have to budget much more than this figure," he said.

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