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Hampton Bays School Officials Facing Tough Road To Stay Under Tax Cap

Publication: The Southampton Press
By Carol Moran   Feb 13, 2013 11:39 AM
Feb 13, 2013 12:49 PM

Hampton Bays officials are facing the tough task of closing a nearly $900,000 gap in order to stay within the 2-percent tax levy cap for the 2013-14 school year, a much larger hole than anticipated, they announced on Tuesday night.

During the district’s first budget workshop, Business Administrator Larry Luce said the Board of Education would need to adopt a $47.9 million budget—one that is almost $2 million higher than this year’s $45.8 million spending plan—in order to maintain programs and services, and cover hikes in pension costs, salaries and employee benefits. That plan would increase overall spending by 4.5 percent.

The budget allowed under the cap, however, would need to total about $46.6 million—$1.3 million less than what is needed to maintain the status quo in terms of programming. Though he was able to reduce that figure to $895,000 with state aid and by making some preliminary adjustments to program costs, Mr. Luce said administrators and board members would need to either find additional sources of revenue or trim spending to avoid piercing the cap.

“It’s a daunting figure, especially if you’re me and you’re sitting behind your desk for the first time figuring out that, ‘Oh nuts, this doesn’t work,’” Mr. Luce told board members and community residents during the meeting.

He added that he anticipated a shortfall of about $200,000. “This kind of a challenge is a bit more than I expected,” he said.

This is the second year that school districts in the state must comply with the cap, which limits the amount they are allowed to raise in school property taxes. If the district proposes a budget that pierces the cap, 60 percent of taxpayers must approve the financial plan in order for it to pass. If it fails, the district can either pitch the same or a revised budget for a second vote. If it fails again, the district will be forced to adopt a spending plan with zero increases from the current year.

During the 2012-13 school year, the district levied about $41.4 million in property taxes. Under the cap, the district will be able increase that figure by about $774,000 for the 2013-14 school year, plus an additional $407,000 that is permitted due to a 37 percent increase in pension costs, which Mr. Luce estimated to be a hike of about $1 million.

He said he was paying close attention to a plan Governor Andrew Cuomo introduced last month that would stabilize pension contributions over the next 25 years and, if approved, would save the district about $400,000. The downside, Mr. Luce said, is that the district would be tied to fixed contribution rates that could be problematic down the line.

Though he and Schools Superintendent Lars Clemensen said they weren’t ready to discuss specifics about spending cuts, they presented a four-part plan to help the district close the gap. Under that strategy, Mr. Luce said he expected he could come up with about $275,000 in program efficiencies, $260,000 in new revenue from sources such as tuition and additional state aid, and about $85,000 from teacher retirement, attrition and vendor contracts.

District officials would need to use about $275,000 in reserve funds to close the rest of the gap, Mr. Luce predicted. He said the district currently has about $800,000 in its reserves.

“This is the first time we’re talking about that in Hampton Bays,” Mr. Clemensen said. “As time goes on, you’re going to see more and more districts in that boat.”

Board of Education Vice President Chris Garvey criticized the state formula that determines how much state aid each district receives based on property values and income. Mr. Luce said Hampton Bays could expect about a $65,000 increase in state aid for the upcoming school year.

Officials will meet on Tuesday, March 12 for the next budget workshop.

“Tonight is really about laying out the landscape,” Mr. Clemensen said. “At our next meeting, we will have a pretty specific menu of things to discuss.”

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These caps are killing the schools, leave it in the hands of the voters. More broadly, we need to do away with property tax school financing entirely if we want our education system to be even across all social spectrum.
By dagdavid (645), southampton on Feb 13, 13 12:54 PM
thank god for the caps, property taxes in Hampton Bays are ridiculously high! How about more money going directly to benefit the kids education, rather than to administrators. We can do much better educating the kids with far less than we're spending now.
By shampton (30), southampton on Feb 13, 13 3:48 PM
What Hampton Bays School district is in financial trouble again? How could this be? Larry Luce just sold a hot pile of %^&* to voters on how a million dollar footbal field, and pavillion will result in no higher taxes. Why didn't he take his savings from his new bond and put the funds into keeping taxes low and not cutting activities? He basically reallocated funds with his accounting nonsense, and the board just smiled and said lets put it to a referendum. Does Mr Luce do 5 years projections on ...more
By chief1 (1499), southampton on Feb 13, 13 9:03 PM
1 member liked this comment
Attend the next budget meeting at 6 pm High School February 28th...don't hide behind a computer. Voice your concerns and become part of the solution rather than blowing steam in the Press.
By Tempt46 (2), Hampton bays on Feb 14, 13 12:20 AM
What happened to the 16 million dollar bond issue the Hampton Bays school District just passed. There was enough pork in that bond issue to cover the budget deficits. It's time to cut some programs or reduce the bloated staffing at the schools. Our School taxes are already over $12 per thousand of assessed valuation while our neighbor the Southampton School District is only $2.30 per thousand. Why is Hampton Bays paying 5 or 6 times the rate of Southampton. It's time to merge the 13 small school ...more
By Ernie (36), Hampton Bays on Feb 13, 13 11:01 PM
Attend the next budget meeting at 6 pm High School February 28th...don't hide behind a computer. Voice your concerns and become part of the solution rather than blowing steam in the Press.
By Tempt46 (2), Hampton bays on Feb 14, 13 12:20 AM
I am not hiding behind my computer. Please stop wasting my tax dollars. Everyone today wants the best services while others pay for them. Do we really need AstroTurf fields in this economy. If deciding to borrow money just so the payments match the last bond issue payment is an example of the kind of decisions made at the school board meetings and telling people this will not result in increased taxes is an example of how to run a school district I choose not to participate. By the way why not ...more
By Ernie (36), Hampton Bays on Feb 14, 13 5:27 AM
1 member liked this comment
Dont forget the seven tennis courts Ernie.
By CaptainSig (439), Dutch Harbor on Feb 14, 13 7:56 AM
HB is no more financial trouble than any other district today...read the papers and realize every school district in NYS is facing this issue. The rising costs, some of which are in their control (most of which are not), are forcing districts to cut elsewhere to cover pension and health costs that are driven independently in Albany. As for the bond, I attended those meetings in 2012 and choosing not to do any projects would have provided relief this year, but that relief would be gone next year ...more
By BaymensBaymen (3), Hampton Bays on Feb 14, 13 8:16 AM
Is your answer everyone else is in trouble that's why we are in trouble? The Hampton Bays School district is going in the wrong direction and no one is capable of stopping it. Many homes in Hampton Bays have multiple families sending kids to school. Many motels have dozens of families sending kids to school. Has the district tried to stop this or investigated this? It has been going on for the last decade and the school is bulging at the seams.
You have Mr oh nuts at the financial helm and ...more
By chief1 (1499), southampton on Feb 14, 13 9:11 AM
1 member liked this comment
Ask yourself this. Why didn't the financial wizard bring up the cap problem when the November vote was going on? Because people would of voted no. I can't feel bad for Hampton Bays they blindly approve eevrything. The avg home in Hampton Bays will soon be paying 10k a year. It's all to better the children. LOL
By chief1 (1499), southampton on Feb 14, 13 2:33 PM
1 member liked this comment
The schools are run for the benefit for the people who work there- thats why all all the compensation contracts are done first then whats left over goes to instruction, and now these two masters didn't foresee costs that have been rising for over a decade. The costs have always just been passed along to the taxpayers- now finally their is some fiscal restraint-and the administrators have no solutions-thats because they are at the root of the problem. Administrative consolidation would save millions, ...more
By bayarea (38), hampton bays on Feb 14, 13 4:16 PM
The schools are run for the benefit for the people who work there- thats why all all the compensation contracts are done first then whats left over goes to instruction, and now these two masters didn't foresee costs that have been rising for over a decade. The costs have always just been passed along to the taxpayers- now finally their is some fiscal restraint-and the administrators have no solutions-thats because they are at the root of the problem. Administrative consolidation would save millions, ...more
By bayarea (38), hampton bays on Feb 14, 13 4:16 PM
I don't go to board meetings anymore, because of the back slapping pack mentality. If you say anything against spending more you get the attitude that you are against the kids. Well I am for the kids that's why it's important to stop burdeoning these children with future debts.
As far as health costs and pension costs going up that should be no suprise to any human in the US over the age of 21. If it is a suprise to Mr Luce it's time for him to resign. Why is it more important to build seven ...more
By chief1 (1499), southampton on Feb 15, 13 8:47 AM
1 member liked this comment
No one is surprised by the increases in pension and health -- it is the AMOUNT of increases, which were higher than anything projected by Albany. And if you look at the history of these rates for more than 30 years, you will see a wild fluctuation in these rates....it's also important to note that even if a bond project wasn't done for maintenance and program upgrades, there would still be a $900k gap. Operating budgets are still held to the tax cap set by albany...capital budgets are not. So ...more
By BaymensBaymen (3), Hampton Bays on Feb 15, 13 10:40 AM
I'm not arguing or debating the merit of the bond -- that was put up for a vote and it passed by a pretty large margin if I remember. What I'm just trying to point out is that the two issues are kind of mutually exclusive because the operating expense gap that HB reports (and Southampton, Westhampton, Sag Harbor, Tuckahoe, and East Hampton all report, among others as well) couldn't be covered by NOT presenting the bond referendum...it's the way the law is written.
By BaymensBaymen (3), Hampton Bays on Feb 15, 13 10:45 AM
The budget must include loan payments as an expense. If we lowered the amount borrowed using the bond issue they would not have to raise taxes as much. It's time to change some of these stupid laws that were put in place due to pressure of the teachers union lobby. It's not about the kids it's about controlling expenses across the board. These are public schools paid out of real estate tax not exclusive private schools paid by people paying tuition.
By Ernie (36), Hampton Bays on Feb 25, 13 12:56 PM
These benefit costs increases are unsustainable- and not unpredictable- plenty of people have disputed the discount rate that is used to determine the contributions that participants have to make into the NYS (teachers)pension plan-health care, what plan does the district use? State employees use the Empire plan and contribute more into it. Finally why doesn't the Administration suggest that employees must contribute more for the benefits- Give the Reuters story" How a vicious circle of self interest ...more
By bayarea (38), hampton bays on Feb 15, 13 6:17 AM
Getting 300k a year having summersoff, and every other holiday off is unacceptable for any public employee besides the president or Governor. Spending more has not made our school system better it has just made taxpayers poorer. Time to wake up this guy makes 6 times the median income of a HB resident. We all work hard and need to stop the madness.
By chief1 (1499), southampton on Feb 19, 13 4:46 PM
1 member liked this comment
The HBSD spends almost $30K per year per student. It would be far cheaper to hire a tutor for every 5 students and let them be home schooled.
By bird (143), Southampton on Feb 19, 13 5:12 PM