New Property Tax Reports Offer Perspective On School Budget Plans

NEW YORK — The annual school-district budget vote is May 16, when residents across the state get a chance to weigh in on what most of their property taxes go to: their local schools.

In New York State, the property tax is local, raised and spent locally to finance local governments and public schools. The state itself does not collect or receive any direct benefit from the property tax. About 60 percent of property taxes are levied by schools, the rest by counties, towns, villages and special entities such as fire districts.

As school officials across the Hudson Valley and Long Island are finalizing their spending plans for 2023-24, the organization RealEstateAgents.com has released a report on the metro areas in the United States with the highest property taxes. Our regions are well-represented.

They ranked the New York City metro area, which includes Nassau, Putnam, Rockland, Suffolk and Westchester counties, as No. 1, with the highest median property tax — $9,091.

The Poughkeepsie/Newburgh/Middletown metro area is ranked No. 6, with a median tax of $7,127. The Kingston metro area clocks in at No. 16, at $5,735 annually, the researchers reported.

"While some people may balk at high property taxes, it’s important to remember that the money goes back into supporting the community and giving local governments the resources they need to protect and assist their residents," the researchers said.

Coming at it from a different angle, researchers for Construction Coverage found that out of all U.S. states, New York had the 11th highest effective property tax rate. New Jersey and Illinois are No. 1. Their report has data on all 50 states and more than 350 metro areas.

School trustees must hold public hearings on their budget and tax plan 7-14 days before the vote, so check your district's calendar for the date. If you want to learn more about your district's plans before then, boards of education are about to vote on final proposals — and have been holding budget workshops and putting information on their websites for the past couple of months.

In addition, district officials must file Property Tax Report Cards with the state every spring right after their budget proposal is finalized; this year that must be before April 24.

Districts are subject to a property tax cap, established in 2012 by then-Gov. Andrew Cuomo, which limits annual tax levy increases to the lesser of the rate of inflation or 2 percent with certain exceptions. The cap can be overridden with the approval of 60 percent of voters.

"School and local communities are still navigating the post-pandemic needs of their students and residents while dealing with high rates of inflation and employee turnover," State Comptroller Thomas DiNapoli said in January when announcing details of the cap for 2023. "School district and municipal officials must exercise fiscal prudence to stay under the cap amid these challenges as they prepare their budgets."

The Comptroller's Office offers this pro-tip:

To determine if your local taxes are increasing, you should examine tax levies not tax rates. Tax rates are not accurate indicators of how much more a school district or local government is collecting in taxes this year. This is because tax rates are based on the total taxable assessments in school district or municipality. If the value of property in the jurisdiction changes, that will skew the tax rate.
For example: a town increases its assessments but keeps the tax rate the same. As a result of the increased assessments, the town collects more in taxes. To collect the same amount in taxes, the tax rate should drop proportionally.
If you want to know if the school district, city, town, or county is spending more, look at the budget. If you want to know if it's collecting more in taxes, look at the levy and the total amount to be collected in taxes.