District looking for way to pay
Agency’s $1.2M school-tax bills remain unpaidBy ZACH SUBAR, The Leader-Herald
Article PDFs
Denial Letter
MAYFIELD - The state comptroller's office has denied the Hudson River-Black River Regulating District's request to transfer some of its money to help it pay school taxes, leaving the regulating district without a clear path to paying the roughly $1.2 million it owes school districts.
The regulating district is unable to pay its taxes. An earlier U.S. Court of Appeals decision said the regulating district could no longer collect assessments from downstream hydropower plants to cover operating expenses such as school and property taxes.
It had previously been collecting such funds.
In an effort to correct the problem, the regulating district asked the comptroller's office whether it could transfer money appropriated for its Black River area to a fund appropriated for its Hudson River area, but the office, in an Oct. 23 letter to the regulating district, said the funds must be kept separate because the cash earmarked for a specific area can only be used in that area.
The letter says the regulating district has "no legal authority" to make the transfer, which would have allowed it to pay the school taxes it owes now as well as an additional $1.4 million in county taxes it will owe after Jan 1. (See the full text of the letter here: www.leaderherald.com/page/content.detail/id/517082.html?nav=5011)
The regulating district will now attempt to borrow money from a different source in an effort to pay its taxes. Executive Director Glenn LaFave said it could hire a lawyer, known as a bond counsel, to help determine how the regulating district is legally allowed to borrow money.
LaFave said the regulating district hopes it can find a loan to help it pay taxes.
"By the time other taxes are due, the regulating district is hoping that we will have some of this revenue that we have borrowed," LaFave said.
In the meantime, school districts are scrambling to figure out their next step. Gov. David Paterson has already announced a proposal for mid-year school cuts, and the regulating district's failure to pay its taxes has made the situation worse for school districts surrounding the Great Sacandaga Lake.
The regulating district owes the Mayfield Central School District $354,000, the Northville Central School District $326,000 and the Broadalbin-Perth Central School District $256,000.
The midyear school cuts mean some school districts will have $500,000 less in aid than what they had anticipated in early September.
Like the regulating district, some school district officials said they may also have to borrow money to temporarily keep their schools running, and "borrowing money costs us money," Mayfield Central School District Superintendent Paul Williamsen said.
"It will have a tremendous effect on us," Williamsen said. "We do have fund balance that we will take a look at."
Williamsen, Northville Central School District Superintendent Kathy Dougherty and Broadalbin-Perth Central School District Superintendent Stephen Tomlinson met with LaFave Tuesday to discuss the matter.
Dougherty said the "lake superintendents," as she referred to the group, now will discuss whether they need to attempt to lobby officials who might be able to help correct the situation.
She said Northville will do a cash-flow analysis to determine if there are areas the school district can cut. Williamsen said the district's audit committee also will look at places where costs might be trimmed.
He said the regulating district may have acted too soon in announcing publicly that it does not have the funds to pay its taxes.
"Be careful of being so quick to say things like that, because it has a great impact on schools, on towns, on municipalities that are affected by it," Williamsen said.
Because it is a state government entity, the regulating district will not be forced to pay a penalty on delinquent taxes. If it does not pay them by the end of the month, the school taxes are turned over to the county, which must pay them before it attempts to procure the money from the regulating district.
Dougherty said the county doesn't normally take action on delinquent school taxes until April.
Zach Subar covers rural Fulton County news. He can be reached at ruralnews@leaderherald.com.
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oldskool
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10-28-09 11:22 PM
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I wonder how long I would be able to keep my property if I owed $1.4 million in county taxes, or $256,000.00 in local taxes for that matter.
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TheArchitect
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10-28-09 9:57 PM
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The District has no other option to look for a way to pay its bills other than what it has been mandated in statute, assigning beneficiary fees to entities that derive a benefit or advantage from the operation of the District. As has been posted for over a year, the upstream beneficiaries will now have to finally pay their fair share, the benefit of highly increased property values as compared to those without access to the State Forest Preserve lands surrounding the reservoir. The only unfair thing about this is this inequity has been going on far too long. Those getting a free ride will clamor at the new fees, but it is undeniable that they have reaped huge financial benefits in property values from their proximity to the reservoir. Fortunately, the tax increase will likely be very small for Saratoga County permittees.
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Genesis
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10-28-09 8:48 PM
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JeffreyR No offense but an average family does not need the things you have listed for tax increases. They are luxuries. Except maybe the taxi cab. Governor Paterson has been on the receiving on of criticism because of making some tough and not well liked choices to try and get us out of debt. The guy had a lot on his plate to deal with from the start thanks to others in office before him. You may not like him but at least he is trying and that is a lot more then you can say for most other people in office.
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ataxpayer
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10-28-09 4:56 PM
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People have to make do with what they have. What are the schools going to do when homeowners can't afford to pay their school taxes?
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Jay001
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10-28-09 3:38 PM
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Paterson is committing political suicide because for over a year he has tried to make unpopular cuts!! The legislature has had their heads in the sand refusing to make cuts while watching the revenue stream decrease. Paterson wants a Tier V contributing to their pension but this isn't popular so the assembly and NYS Senate refuse to make cuts to address decreased revenue.
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Preacher
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10-28-09 3:34 PM
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scarecrow, I hope you mean cut the frivolous spending so you can pay the bills for the things you really need...like education. Right?
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JeffreyR
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10-28-09 3:22 PM
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FC:Just a few here on the tax side of things. He outlined several new taxes and fees. The 137 tax and fee increases contained in Governor Paterson's 2009-10 Budget would cost the average NY family an extra $3,875.48 annually. These taxes include: New 4% Taxes on digital music downloads, videos and pictures downloaded or the "itax". A tax increase on malt-flavored beverages, beer, and wine. A 4% tax on taxi rides, car rentals and limousine services. A tax on movie tickets. A new 4% 'personal services tax' on haircuts, beauty salons, health club services, and weight loss programs. Taxed to DEATH.
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FCjobs
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10-28-09 12:56 PM
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Jeffrey - As a republican, I can defend patterson - He has committed political suicide by standing up to the unions and special interests. What do you see as his biggest action to raise the state budget?
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FCjobs
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10-28-09 12:55 PM
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Jeffrey - As a republican, I can defend patterson - He has committed political suicide by sdtanding up to the unions and special interests. What do you see as his biggest action to raise the state budget?
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JeffreyR
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10-28-09 12:40 PM
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Jay001: There is NO defense when it comes to Patterson, none at all. He is the absolute worst. No money in the till or coming in and hey, let's raise the state budget numbers to all time highs.
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Scarecrow57
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10-28-09 12:08 PM
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Here is a novel idea. CUT THE SPENDING so you can pay the bills you have to pay. The spineless democrats can't do the right thing.
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Jay001
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10-28-09 11:50 AM
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State aid was cut mid-year almost 20 years ago. With state revenues declining (sales taxes, etc.), Gov Paterson is doing the only responsible thing!! You can't continue to pay money you don't have - something he's been trying to explain to the Assembly and NYS Senate.
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IKnooow
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10-28-09 11:31 AM
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Can't raise school taxes half way through the year. I wonder what King Obama thinks of our governor now, since schools were instructed to show how they saved jobs thanks to the first wave of stimulus money; money that the NYS gov is now threatening to take back half way through the year.
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Discobulous
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10-28-09 10:55 AM
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They'll do what every school system does, tax h e l l out of the tax payers.
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