Wednesday, May 25, 2016

Fiscal Stress..

According to the NYS Comptroller Thomas P. DiNapoli's website, his office:
"created an early warning system for communities and school districts with fiscal problems. Alerting everyone to potential problems gives local officials and taxpayers the opportunity to be more proactive."

I like to view his report each year to see where local municipalities stand regarding these benchmarks.

The system, which is currently using 2015 data, has two components; Financial and Environmental.

According to the 2015 date, New Hartford is at 0% for Environmental which takes into account Change in Property Value; Change in Enrollment; Trend in First Budget Vote Being Defeated; Change in Approval Percentage for the First Budget Vote; Graduation Rate Percentage; and Free or Reduced Priced Lunch Percentage.

However, the Financial component is based on Unassigned Fund Balance; Total Fund Balance; Operating Deficits; Cash Ratio; Cash as a Percentage of Monthly Expenditures; Short-Term Debt Issuance; Short-Term Debt Issuance Trend.

I was surprised to learn that for 2015 New Hartford Central School is extremely close to being considered "Susceptible to Fiscal Stress".

New Hartford's 2015 stress score (figured by reports sent to the State Comptroller's office) is 23.3%...the benchmark for being considered susceptible is a score of 25% or more.

The report also shows that in 2014, their stress score was 0% and 6.7% in 2013. What happened in 2015 for such a drastic change?

Looking at the Excel spreadsheet for New Hartford, it would appear that their problems are primarily use of fund balance and budget deficits.

As a taxpayer, my questions would be...

  • is the school board aware of the Comptroller's report 
  • has the school implemented a plan to address its financial situation?

You can view the reports and read documentation on how the reports are created by visiting the NYS Comptroller's Office Fiscal Stress Monitoring System.

Monday, May 23, 2016

Changes to the NYS STAR exemption...

Governor Cuomo signed legislation on April 13, 2016 enacting significant changes to the NY School Tax Relief ("STAR") exemption program.

The changes apply only for new homeowners that purchased a home in New York State, on or after March 1st of 2015.

Instead of new homeowners receiving an exemption on their tax bill, they will receive a school tax bill for the entire amount owed and the State will send a check supposedly in September.

Details are sketchy as to just how this will work (will you have to apply or is reimbursement automatic?) and seem to vary to some degree depending on what website you visit; there isn't a lot of clear information on the Dept. of Taxation and Finance website at this point either.

Many newspaper, lawyer, and assessor websites are reporting that a brochure will be received from the State sometime in May to explain the process. So for those affected, the brochure is in the mail and you should receive something to explain the process any day now!

There are already fears of the impact on new homeowners who have escrow accounts. It has been suggested by some that if you have a mortgage on your new home, and your taxes are paid through escrow, you may want to contact your escrow company to see how your mortgage payments are calculated (STAR exemption considered or not).

The reasoning behind the change is for the schools to get some of the STAR exemption monies sooner instead of having to wait for the state to reimburse them as they have in the past.

In other words, as one State Assemblyman put it in one news article I read, "It’s the taxpayer that waits to get the check".

Lovely...welcome to New York State!

For more information...

Visit the NYS Dept of Taxation and Finance here!