Property tax levy growth for school districts will be capped at 1.81 percent for the 2020-21 fiscal year, down from a 2 percent cap in each of the two previous years, according to data released recently by State Comptroller Thomas DiNapoli.
“As the levy growth rate dips below 2 percent, school district and municipal officials need to be fiscally cautious and examine where they can limit spending to stay under the cap,” he said. “Local governments will have to examine their budgets more closely to control expenses.”
The 1.81 percent cap affects the tax cap calculations for 676 school districts, as well as 10 cities with fiscal years starting July 1, including the “big four” cities of Buffalo, Rochester, Syracuse and Yonkers.
The tax cap, which first applied to local governments and school districts in 2012, limits annual tax levy increases to the lesser of the rate of inflation or 2 percent with certain exceptions, including a provision that allows school districts to override the cap with 60 percent voter approval of their budget.
Local school boards have the right to override the tax cap by submitting a budget to the voters that must be approved by 60% of the voters. Very few school districts have exceeded the tax cap since it was enacted in 2011. In 2019, NY State made the property tax cap permanent.
