Tonawanda News — The City of Tonawanda school board voted to implement a 2.55 percent tax levy increase for the 2014-2015 school year on Tuesday night, but under a new state program, residents will be reimbursed for some of the increase on their tax bills.
At the last meeting, members of the board and the budget advisory team said they preferred the 2.55 percent tax levy increase if the district took part in the optional tax-freeze deal. As part of that program, qualified taxpayers will receive a credit for the difference between the current school tax bill and the next year’s bill.
The tax-freeze option was announced recently as part of the state budget, and some details about how the program will be implemented remain unclear.
“We aren’t sure if it is a credit on the New York State Income Tax or a check,” Interim Financial Manager Richard Hitzges said. “It says a credit in the bill, but the New York State Department of Taxation talks about a check.”
The basics of the deal are laid out in the bill, though, Hitzges said.
To qualify for a refund, residents’ primary property must be located in the city and they must be eligible for STAR. The refund will not cover changes in a tax bill due to improvements to the home and revaluations. As a result, an increase on a residents’ tax bill due to the recent assessment update in the city will not be covered under the rebate.
Residents will still pay their tax bills, but will then receive a refund from the state afterward. Under a 2.55 percent tax levy increase, the average home bill would increase by $29.52 per year.
In the second and third years of the state program, the district will be required to develop a state-approved government efficiency plan that shows savings due to shared services, cooperative agreements or mergers. The district must not exceed its tax levy limit each year to comply with the program.