Educators Express Concerns Regarding Tax Cap

Rockland County Teachers Association President Donna Ramundo calls it an attack on education.

The Pearl River resident, who is also president of the Nyack Teachers Association, is just one of many educators across the state expressing grave concerns about the impact of Gov. Andrew Cuomo's proposed 2 percent tax cap.

"I've seen the good, the bad and the ugly and right now what I'm seeing is the ugly because of the attack on public education," Ramundo said. "It's not just teachers. This involves kids, administrators and teaching assistants."

Cuomo and legislative leaders recently announced a tentative deal on the property tax cap, which has been discussed for years. Some form of a tax cap bill is expected to pass before the end of the current legislative session later this month, though issues such as possible exceptions are still being discussed.

"I think given [the] support that we hear it has in the Senate, and couple that with the recent statement from [State Assembly Speaker Sheldon] Silver, I think it has some serious momentum," said Pearl River Superintendent of Schools Dr. Frank Auriemma. "I also think that perhaps similar to New Jersey, there may be some safeguards put in to the 2 percent for things like healthcare and pensions and perhaps tax certioraris.”

"All of those could take a 2 percent cap and really move it closer to 3 percent."

The tax cap would limit the potential tax levy increase in a district each year to 2 percent. The Pearl River School District budget for 2011-12, for example, includes a 2.75 percent increase. Auriemma said that while such a limit may work some years, as a long-term standard, all districts would struggle.

"An annual cap of 2 percent practiced over time will have a big impact," Auriemma said. "I think people worry that it might be similar to the impact of the tax cap in California, which as seen by virtually anyone’s measure, was very, very significant."

The constraints put on district budgets by a tax cap could lead to schools having to make major cuts in programs and staff. That could lead to much larger class sizes, which put a burden on teachers and students.

"When you choose a college class, you don't want a class with a million people in it," Ramundo said. "You want a small group because you can ask questions. Your needs are taken care of.”

"When you have 30 kids in a class and the problems kids have these days, you need more people [teachers] in the classroom. Twenty-five is big. When we have 25 in a class, especially little ones, it makes it difficult for the kids to get that individual help they need. You have a lot of standards that need to be addressed. We are cutting things needed to give children the best conditions to learn."

Ramundo said she agrees with the need for tax relief, but she believes that the state is looking in the wrong place.

"People want relief and they will grab at anything," Ramundo said. "Unfortunately, teachers are targets."

Ramundo argued that in the long term, the economic impact could be a negative one.

"If you have a 2 percent tax cap and all the unfunded mandates (and expenses) for schools that are out of control, such as energy costs, pensions, contractual agreements and special education, what will happen is you will have more unemployment," Ramundo said. "Teachers will be laid off. Adjunct professors at colleges, too. Tuitions will go up. Class sizes will be larger and programs will be lost. Who's going to suffer? The kids."

Strong schools can also have an economic impact on an entire community's economy, particularly through property values.

"I moved to Pearl River because of the schools," Ramundo said. "If things start to go downhill, our property values will go down. I do see the need for property tax relief, but they are hitting one area—that's the schools. They've already cut so much in state aid."

Proponents of the cap argue that residents and businesses need relief from the growth of property taxes that is exceeding the increases in salaries.

"Over the past eight years, property taxes in Rockland have grown at double the rate of wages," said Assemblyman Ken Zebrowski (D-New City) in a video on his website that can be viewed here. "That is just unsustainable."

Many educators have made the same claim about keeping tax increases capped at two percent. Auriemma said there are circumstances that could make it work, but there would have to be other changes at the state level along with the cap.

"If we had a slight increase in state aid ... bump it back up a little because we lost a whole lot," Auriemma said. "Start to address some mandate relief—now we're getting to the point where the objective is a little more doable over time."

Pension Relief for Local Governments, School Districts

Cuomo has proposed a new tier for public pension systems in New York State and New York City, which would impact those contributing into the Employee Retirement System (ERS), Teachers Retirement System (TRS) and Police and Fire Retirement Systems (PFRS).

"This bill institutes common-sense reforms to bring government benefits more in line with the private sector while still serving our employees and protecting our retirees," Cuomo said in a statement. "Reducing the skyrocketing pension burden faced by local governments and schools will also help get control of local property taxes that are driving New Yorkers from their homes and from the state."

Among the proposed changes would be:

• Raising the retirement age from 62 to 65
• Ending early retirement
• Requiring employees to contribute 6 percent of their salary for the duration of their career
• Providing a 1.67 percent annual pension multiplier
• Vesting after 12 years instead of 10 years
• Excluding overtime from final average salary
• Using a five-year final average salary calculation with an 8 percent anti-spiking cap
• Excluding wages above the Governor's salary of $179,000 from the final average salary calculation
• Eliminating lump sum payouts for unused vacation leave from the final average salary calculation
• Prohibiting the use of unused sick leave for additional service credit at retirement

Major increases in pension payments are one of the concerns cited by the Pearl River School District administration, which has argued that the salary givebacks by most of the district’s unions this year may have only staved off major cuts in programs and staff for a year, especially if the tax cap is put in place.

"Without a doubt, I don't think there is any district that is not going to plan for the worst-case scenario," Auriemma said.

Does a Tax Cap Do Enough?

One proposed exception to the tax cap would be to allow districts to pass a budget with an increase exceeding the cap as long as 60 percent of voters approve it. Auriemma said that while that may be helpful as a short-term solution, it is not something a district could regularly do.

"The issue of passing budgets has a lot to do with credibility and straightforwardness and those things are very big factors," Auriemma said. "As you enter into something where on a given year you have to depend on the 60 percent, it could happen in a real isolated type of thing, but it cannot be standard table fair. 

"If you have a situation where something comes up in a given year, the populace are intelligent people. If you explain your case clearly enough, maybe it will be successful, but to try to do it unilaterally over time, you will wear people's patience rather thin."

Teachers Respond

On May 31, opponents of the cap protested outside the New City office of Assemblyman Ken Zebrowski, asking him to reconsider his support of the tax cap bill. Zebrowski sponsored the agreement proposed by the Assembly in May.

"In my district in Rockland County, residents are paying some of the highest property taxes in the nation," Zebrowski said in the video on his website. "This will cap growth at two percent per year. This will be a welcome releif to homeowners, but also to businesses. We're trying to grow our economy, row jobs. We have to make sure businesses aren't paying these onerous taxes as well."

Cuomo has claimed there is strong public support for a cap.

"I can’t tell you how many times somebody has come up to me and said, ‘You have to do something about property taxes; I just can’t afford to stay in my home anymore,'" Cuomo said at a press conference, adding that the cap would "change the trajectory of this state."

The teachers' association also has been calling for supporters to voice their concerns to State Senators and members of the Assembly. Ramundo argued that she has heard very little from the public in support of a tax cap.

"The school boards represent the community," Ramundo said. "Why are we having a cap? You haven't heard people on school boards say they want a cap. You haven't heard community members saying they want a cap.

"Why take voting power from the people with this legislation? We already have a right to vote a budget to pass or not. It seems to me like Cuomo is just trying to make his mark."

She pointed to teachers in many districts agreeing to salary givebacks and paying more into their retirements than in past years. Ramundo expressed concerns over the attitude she has seen toward teachers.

"One thing I've said before is why is someone sending kids to a place to be taught when you don't respect the teachers?" Ramundo said.

"Unfortunately, things cost money. Teachers have an education. They go to school beyond their Masters degree. They get doctorates. They do professional development. We do what we can for kids."