10 Oct 2017 - Marlboro Central School District. Michael M. Brooks. Superintendent of Schools. Central Administration, 21
Marlboro Central School District Michael M. Brooks Superintendent of Schools
October 10, 2017 Dear MCSD Families, In case you did not see the news over the weekend concerning the $1.2M tax shortfall we are currently facing, I am providing you with links to two articles and I encourage you to read them. I have also attached the press release I sent out on Friday regarding this matter. As most of you know, we have been making a concerted effort to be extremely responsible with our finances. For those of you who lived through the recent period of staff layoffs and economic turmoil, I am sure this new issue raises questions and concerns regarding our status and our future. I want to assure you that our financial position is strong. That being said, this is a significant setback. We will need to work as a district to absorb $1.2M in our current operating budget and use fund balance or reserves to bridge this funding shortfall. It is important to note, this is no fault of the school district. We are actively meeting with Town of Newburgh officials as well as county and state representatives to seek an external solution. As I said in the attached statement, we are not passively accepting this loss. Our programs and our taxpayers should not suffer because of a "clerical error" from a tax assessment. I will keep you informed as we work towards finding a solution. We have all worked too hard to accept this setback without first exploring all possible avenues.
Sincerely,
Michael M. Brooks Superintendent of Schools Poughkeepsie Journal http://www.poughkeepsiejournal.com/story/news/education/2017/10/07/marlboroschool-district-must-make-up-1-2-million-tax-bill-after-clerical-error/742524001/ Times-Herald Record http://www.recordonline.com/news/20171009/marlboro-school-district-loses-12m-intax-revenue Central Administration, 21 Milton Turnpike, Suite 100, Milton, NY 12547 Phone: (845)236-5802 Fax: (845)795-5904 www.marlboroschools.org
Marlboro Central School District Michael M. Brooks Superintendent of Schools
October 6, 2017 $15 Million Error by Town of Newburgh Tax Assessor Threatens Marlboro Central School District Finances The Orange Country Real Property Tax Service Agency and Town of Newburgh Assessor’s Office have contacted the Marlboro Central School District about a $15 million error they made in their taxable value calculation, which is used for determining 2017-2018 school tax bills. Their error has created a $1.2 million shortfall in the taxes collected for the 2017-2018 school year. Distressing details of the error and resulting implications to the district’s long-term financial strategy were shared at the Marlboro Central School District’s Board of Education meeting on October 5. Local assessors are responsible for providing school districts with the assessed value of all properties located within the school district. The district uses this information to apportion the amount of the tax levy for which each individual municipality is responsible. This portion is then distributed among all of the district’s taxpayers within that municipality. The erroneous assessment value was discovered by the Orange County Real Property Tax Service Agency when the Roseton Generating LLC power plant received their tax bill and noted that their assessed value was not correct. Roseton filed a grievance with the Town of Newburgh and an investigation was conducted. On September 13, 2017, John McCarey, director of the Real Property Tax Service Agency in Orange County, issued a report, which was shared with the school district, calling the mistake a “clerical error.” Roseton has a court ordered settlement for annual reductions in their assessed value through 2019. The Town of Newburgh assessor failed to apply the court ordered Central Administration, 21 Milton Turnpike, Suite 100, Milton, NY 12547 Phone: (845)236-5802 Fax: (845)795-5904 www.marlboroschools.org
reduction to the 2017 tax roll. This resulted in an inflated taxable value for the plant. Their tax bill has been reduced by $1.2 million, creating the shortfall. “The implications of this mistake are serious,” explains Marlboro Superintendent Michael Brooks, who says that unless the money can be recovered through other sources, it will likely need to be made up by using existing fund balance and reserves. This will set back the district’s long-term financial strategy for building up its capital reserve by at least two years. The capital reserve was approved by District voters to offset tax implications for making future facilities improvements and repairs. While Roseton received a higher than expected tax bill, most Marlboro Central School District taxpayers actually saw a decrease in their 2017-2018 school tax bills, which were issued on September 1, 2017. Since Roseton was overcharged $1.2 million, the remaining district’s taxpayers were undercharged. For example, had the correct assessed value been applied to Roseton, a Town of Marlborough or Plattekill homeowner with a $200,000 assessed value receiving the Basic STAR exemption would have paid $166 more in taxes. A similar homeowner in the Town of Newburgh would have paid $158 more. Since this year’s tax bills have already been issued, the district is unable to redistribute the levy using the correct values. The adjusted amounts can be incorporated into next year’s tax bills, but this will not recoup the loss of this year’s revenue. The shortfall will have to be made up in another way. “We have been strategically addressing the devaluation of the power plant for the past five years, making budget decisions and adjustments to protect our educational program and minimize the impact of the reduced tax base. The loss of $1.2 million undermines the hard work that has gone into creating fiscal stability for our community,” says Brooks. “I am very disappointed, but I am not passively accepting this loss without making sure we have done everything possible to minimize negative impacts to our schools,” Brooks says. “I plan to meet with local, county, and state representatives to see if they can intervene on behalf of the
students and taxpayers of the Marlboro Central School District. I will continue to push for solutions that do not come at the expense of our students and community.”
IMPLICATIONS (*for reference only)
Marlborough & Plattekill Basic STAR Enhanced STAR No STAR Exemption
Home Sale Price
17-18 Actual Tax
*17-18 Re-calculated Tax
Difference
$200,000 $200,000 $200,000
$4,592 $3,609 $5,423
$4,758 $3,739 $5,618
$166 $130 $195
$200,000 $200,000 $200,000
$4,384 $3,155 $5,423
$4,542 $3,269 $5,618
$158 $114 $195
Home Sale Price
17-18 Actual Tax
*17-18 Re-calculated Tax
Difference
$300,000 $300,000 $300,000
$7,304 $6,321 $8,134
$7,567 $6,548 $8,428
$263 $227 $294
$300,000 $300,000 $300,000
$7,096 $5,867 $8,134
$7,352 $6,078 $8,428
$256 $211 $294
Newburgh Basic STAR Enhanced STAR No STAR Exemption
Marlborough & Plattekill
Basic STAR Enhanced STAR No STAR Exemption Newburgh Basic STAR Enhanced STAR No STAR Exemption
