The Chappaqua school district is taking a hit in its proverbial wallet, as the school board has voted to approve readying funds to pay for the
The vote Tuesday morning was unanimous but lacking enthusiasm.
"Grr," one board member quipped when the item was raised for the agenda.
The New Castle Town Board, with the district being made aware, voted to approve the settlement with Riverwoods in July, ending the challenges to its property assessment. The town does property assessment and collects taxes for the school and Westchester County.
The district is required to pay out $933,894.90 to the 148-unit development in northern New Castle, representing the district's share of a property tax reduction of nearly $1.4 million from 2009 to 2011. The town and Westchester County will each have to refund amounts that are more than $200,000 each, which pale in comparison to the district's portion.
The first two years will be refunded through payouts, while 2011 will be refunded through a reduction in 2012-13 tax collection.
Board members noted that they have to vote on something they cannot determine.
“It’s odd to have to approve of something that we have no control over," said board President Victoria Tipp.
After the Riverwoods vote, the board approved the district's share of a smaller tax reduction, $5,283.26 to a homeowner as part of a court-ordered reduction, which is one of many cases pending in the system.
“There’s something inherently odd about us approving things that have been court ordered," said board member Jeffrey Mester.
Riverwoods was especially significant because it had a major effect in altering the tax rates for the 2012-13 school budget, to the point where they rose from projections given in the spring when voters approved the budget. The summer nature of the settlement also led to a delay in the figures being ready. The rates are going up in order to collect the same amount of money for the district's 2012-13 tax levy, using a diminished tax base to draw from.
As a result, New Castle residents will see a hike in the tax rate - it is the amount of money paid per $1,000 of assessed property value - of 2.33 percent, versus a projected 1.63 percent in April. Mount Pleasant residents of the district, already confronted with a 9.6-percent projection, will see their final tax rate hiked by 10.35 percent. The gap between the towns is the result of the equalization rate, which is required for calculating what taxpayers in each town owe because the communities do not assess properties at the same percentages of their market value.
The rise is the tax rates comes as a result of a sharp drop in taxable value for properties throughout the district. In total, the taxable amount dropped by $7,883,042 in New Castle from last year, and by $54,151. The single-largest part of the New Castle drop came from a $3,913,195 decline in taxable value from Riverwoods. However, the condo complex settlement impacts the tax rates in both towns, explained Assistant Superintendent for Business John Chow, because any decrease in available tax revenue can change them.
The tax rates are not limited by the state-mandated property tax cap; it only limits the tax levy, which is the total amount of tax revenue to be collected. The cap, adjusted annually to be the lesser of 2 percent or the inflation rate, has some exemptions built into it, such as pension costs and tax base changes.
Riverwoods is not the only tax reduction on the agenda; the board approved funding more than $5,000 for a court-ordered drop. There have been many such tax challenges in the district, Chow explained.
Asked about whether there are any other big challenges, Chow acknowledged that the only other large one is Chappaqua Crossing, for which owner Summit/Greenfield is suing from 2008 to 2011.