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Board hears mid-budget update; officials explain why STAR or Enhanced STAR doesn’t always eliminate school tax
Summary
District officials gave a mid-budget review showing a projected $3.4 million gap, explained how foundation aid proposals could affect revenue, and walked through why changes in STAR/Enhanced STAR exemption amounts can cause homeowners who previously paid no school tax to receive bills.
The Niagara Falls City School District Board of Education received a mid-budget update on March 13 that showed the district narrowing a projected budget gap but still facing roughly $3.4 million to close before the May 20 vote.
Board President Mark and district business staff described revenue-side variables, including state Foundation Aid proposals: the governor’s budget baseline includes a 2% increase in Foundation Aid, the state Senate proposed 3% and the Assembly proposed 2.9. Mark said even modest changes in those percentages would alter the district’s multi-million-dollar revenue forecast.
On the expenditure side, officials said they have incorporated preliminary rate changes for property/casualty insurance (estimated at 8–10%, conservatively budgeted at 10%) and health insurance (the family rate budgeted at 7%). Transportation cost estimates were adjusted using the Northeast CPI (the district used a 4.1% figure as a conservative placeholder). The president said the district’s tax levy figure currently under consideration is $202,385,135; he emphasized the final levy and tax rate depend on the full budget process.
District business staff Becky walked the board and public through how STAR and Enhanced STAR exemptions affect individual school tax bills. She explained that the state Department of Taxation sets the exemption amounts each year, which reduce the assessed valuation a homeowner pays tax on; in some prior years the Enhanced STAR reduction exceeded a home’s assessed value, resulting in no school tax for that parcel. When the maximum STAR exemption amount declines or is reset by the state, a homeowner who previously paid no school tax can receive a bill even if their personal circumstances did not change. Becky said household income limits also determine Enhanced STAR eligibility and recommended residents ask the city assessor for an individualized calculation.
The board discussed reserves and possible reserve use; Mark said the district plans to avoid staff or program cuts and will recommend using reserves (including a previously noted $915,000 reserve for debt) rather than layoffs in his early April recommendation. He said the board will finalize the budget on April 10, present it to the public and then ask voters to approve the levy on May 20.
Ending: Officials encouraged residents with questions about STAR calculations or exemption eligibilities to contact the assessor’s office or district staff for an individualized explanation. The board set a schedule for further budget discussions and a vote in April.
