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Hopkinton, Clifton inappropriately exceed state tax cap; Edwards, Parishville take corrective action and lower tax bill

Posted 1/10/12

Hopkinton and Clifton have inappropriately exceeded the state tax cap, while Edwards and and Parishville took correction and lowered tax bills, according to the state Comptroller’s Office. Those …

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Hopkinton, Clifton inappropriately exceed state tax cap; Edwards, Parishville take corrective action and lower tax bill

Posted

Hopkinton and Clifton have inappropriately exceeded the state tax cap, while Edwards and and Parishville took correction and lowered tax bills, according to the state Comptroller’s Office.

Those are highlights of a just-released statewide report indicating some St. Lawrence County taxing districts have not complied with the requirements of the state property tax cap, others have, and others needed some help, according to a spot-check by state auditors.

Municipalities in St. Lawrence County that inappropriately exceeded the cap were Town of Hopkinton, $12,506 over the levy limit, over by 2.4 percent; and the Town of Clifton, $468, 0 percent overage, according to the auditors.

In instances where auditors discovered that a local government was planning to levy an amount in excess of the limit without the required override vote, local government officials were advised to reduce the amount on the January 2012 property tax bills.

Statewide, ten municipalities took corrective action after working with DiNapoli’s office to save taxpayers from being improperly billed. This approach helped local officials navigate the new law and kept taxpayers from being improperly charged.

Among the 10 local governments that reduced taxes billed were the Town of Edwards and the Town of Parishville.

Auditors found that 177, or 22 percent of local governments throughout the state passed a local law or resolution to override the property tax cap. Among the governments that legally overrode the cap are the Town of Massena and the Town of Piercefield.

Of those visited, 28 percent had to rely on DiNapoli’s office to calculate their tax cap for them. Thirty-three percent inaccurately calculated their tax cap.

More than 70 percent of local governments reviewed by auditors had adopted budgets with a property tax levy that was within the allowable limit, while five percent exceeded the cap inappropriately, according to an analysis by New York State Comptroller Thomas P. DiNapoli’s office.

In the last few weeks DiNapoli sent more than 200 auditors across the state to review the new budgets of 798 municipalities. Not every municipal authority was audited.

Those audited groups in St. Lawrence County that stayed within the tax cap are Edwards Fire District, Fine Fire District, Lisbon Fire District, Morley Fire District, Parishville Fire District, Town of Brasher, Town of Clare, Town of Colton, Town of DeKalb, Town of Depeyster, Town of Hermon, Town of Lawrence, Town of Lisbon, Town of Lousiville, Town of Morristown, Town of Norfolk, Town of Pierrepont.

“My auditors will be visiting the municipalities that exceeded their tax cap improperly to make sure they have taken corrective action and reduced their tax bills or put any excess property tax revenue into a reserve as required by the law,” DiNapoli said. “Our review assisted local governments by providing insight into common issues and errors calculating the new tax cap, and I have directed my staff to develop additional training and expand our outreach to eliminate these errors.”

Of the municipalities DiNapoli’s auditors visited, 43, or 5 percent, inappropriately exceeded the allowable cap. If allowed to stand, property taxes for these localities would rise more than allowed under the tax cap law.

New York State’s property tax cap, enacted in June 2011, limits annual increases in the total amount of property taxes local governments and school districts can levy to either 2 percent or the rate of inflation, whichever is less, with some limited exceptions. All local governments and school districts subject to the cap are responsible for determining their tax levy limit and reporting that limit to the Comptroller’s Office prior to budget adoption.

Under the law, if a local government exceeds the property tax cap without first enacting a local law or resolution to override the cap, the excess amount levied must be placed into a reserve and used to offset the taxes levied in the next fiscal year.

DiNapoli’s office informed the municipalities that did not have the ability to fix the error prior to the printing of their tax bills that the amount levied in excess of the cap must be placed into reserve in January – the start of the local fiscal year.

Local governments file their information with the Comptroller’s Office based on their fiscal years and before they pass their annual budgets. School districts must file their information by March 1.

In an effort to increase transparency and accountability related to the tax cap, the Comptroller’s Office will be making the property tax cap report submitted by every local government available on its Open Book New York site, www.openbookny.com, by the end of January.