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History
- Referred to local government
- Referred to local government
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Relates to unexpended surplus funds which may be retained by a board of education
In Assembly Committee · Education · Sponsor Ginny Fields
Full text
The text isn't available here yet. Check nysenate.gov.
Sponsor's memo
Title of bill
An act to amend the real property tax law, in relation to unexpended surplus funds which may be retained by a board of education; and to amend the education law, in relation to property tax report cards
Purpose
This legislation permanently reduces the amount a school district may retain in their surplus fund balance from four percent to two percent if a school district violates the amounts set forth in subdivision 1 of section 1318 of the real property tax law, by impermissibly retaining less than four percent as required by the aforementioned section of law. This legislation also requires violating school districts to admit that they have retained less than four percent in their surplus fund balance on their school districts property tax report card.
Summary of provisions
Section 1 amends the real property tax law to provide that those school districts that retain less than three percent in their surplus fund balance for 2007 and less than four percent in their surplus funds balance for 2008 and all years thereafter, shall not be permitted to retain more than two percent in their surplus fund balance for all subsequent years.
Read the full memo (627 words)
Section 2 amends the education law to provide that those school districts that retain less in their surplus fund balance than the amounts required by subdivision 1 of section 1318 of the real property tax law, shall be required to state in the school district tax report card that the have retained less in their surplus fund balance than required by law.
Justification
In the past school districts have complained that the two percent fund balance limit was inadequate to meet their needs when unforeseen expenses arose. In 2007, subdivision 1 of section 1318 of the real property tax law was amended to increase the amount that school districts were permitted to retain in their surplus fund balance from two percent to three percent in 2007 and four percent in 2008. The goal was to allow these school districts to hold greater amounts in reserve thereby eliminating the need to borrow funds on a short term basis.
Notwithstanding the aforementioned, there are school districts in the State of New York who have violated this law by retaining less in their surplus fund balance than the amounts set forth in subdivision 1 of section 1318 of the real property tax law. The law was amended to allow these school districts to keep more money in their surplus funds so that they could be prepared for unanticipated operating expenditures such as higher fuel and energy costs. Despite giving these school districts the legal mechanism to prepare for unanticipated financial problems, some districts have disregarded the law thereby increasing the likelihood that they will need to rely on short term borrowing if unexpected expenses arise.
The beneficial aspects of this legislation is that it does not penalize school districts who comply with subdivision 1 of section 1318 of the real property tax law. Another benefit is that it does not pass any costs onto citizens of an offending school district by increasing their taxes in any way. This legislation also requires transparency on the part of school districts by forcing them to admit to their noncompliance with the law in the school district report card thereby separating those districts who comply with the law from those that do not.
Legislative history
Similar to A.415/S.1249 (2001-2002), No Action); A.7081-A/S.2232-A (2003-2004, Passed Assembly); S.6383/A.949-A (Passed Assembly in 2005 and Veto 220 in 2006); S.1465-B/A.3249-A (passed Senate and Assembly in 2007 and signed into law on July 18, 2007, Chapter 238); 2008, S.7835
Fiscal implications
None to the State.
Effective date
This act takes effect on July 1, 2009.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.