The Levittown school board spent Wednesday night's planning session debating whether they should raise the tax levy by the maximum alloted amount.
With the board limited to a 2.51 percent tax levy increase, assistant Superintendent of Business and Finance Mark Flower presented five-year plans for four different budget scenarios. The budgets projected what district expenses would look like if the district raised the levy by 0, 1, 2 or 2.51 percent for 2012-13. Each budget allocated a 2 percent levy increase over the four years following 2012-13.
With a 0 percent tax increase in 2012-13, Flower projected that the district's reserve funds would run out by 2015-16. That would cause the district to reduce its budget for 2015-16 and 2016-17. The other projections anticipated reserve funds emptying by 2016-17, but the potential 2016-17 cuts shrank as the 2012-13 tax levy increased.
Board president Mike Pappas questioned Flower's expense projections. He specifically wondered if the fund balance would shrink as much as Flower suggested.
"We don’t spend what we budget," he said. "You have the total fund balance shrinking and that’s not really the case. It’s going to shrink, but to say that it’s going to go from $48 [million] to $21 [million] to $12 [million], you haven’t accounted for any recurring expenditure decreases, and there are some already built into this budget."
Pappas compared the levy cap to a vampire. ("It’s sucking our blood dry and we’re all going to run out of blood eventually," he said.) But he was also concerned with burdening the Levittown taxpayer, even with a small levy raise.
"To a senior citizen, it might be five weeks' worth of food," he said. "We owe it to that person to have [a reasonable] tax increase, not something that’s going to bankrupt you."
Flower recommended that the board request the maximum levy. He mentioned that in years past, the board could give taxpayers a break one year and then raise the levy significantly the next. To go over the cap in the future, however, would require the district to pass a budget with 60 percent of the vote.
"Whatever you don’t take this year in levy, you lose that money forever," he said. "You really can’t make it back up under the way this law is calculated."
Board vice president Peter Porrazzo agreed, citing the uncertainty of future budgets. "We're clearly better off with levying something," he said. "Nobody has a crystal ball. We don’t know where this is going. We don’t know if things are going to get worse before they get better in Albany."
According to Flower, the board could actually raise the levy up to 1.5 percent over their maximum if they went out with a 0% levy increase this year. Using this scenario, they could ask for a 3.5 percent increase the next year and only need a simple majority to pass the budget. Trustee Peggy Marenghi and Porrazzo worried, though, that the public wouldn't understand why the board was going over the 2 percent cap.
One factor that could alter future budget projections is the re-negotiation of two teacher's union contracts that expire at the end of the school year. Porrazzo suggested that it may be best to take the maximum levy this year and re-evaluate for 2013-14 after contracts are agreed upon.
Flower said that the board did not technically need to set a tax levy until August, since the community was only voting on the budget. He added, though, that the board should set one anyway so the public can know before they vote.
Despite the debate, the board remained optimistic that they would come to a reasonable solution.
"I don’t think we’re too far off," Pappas said. "I think this will be a non-inflammatory budget to the entire community. I hope it’s not that non-inflammatory that people don’t get out and vote. You still have to get your butts out there and vote."