The Oysterponds school board didn’t take any action on a veterans tax exemption program Tuesday night and decided to reopen the discussion in the spring, meaning the exemption will not be in effect for this year.
During Tuesday’s meeting, the school board reopened its public hearing to discuss opting into the exemption. At the first public hearing on Feb. 11, school board members said they needed more information before casting a vote.
The veterans tax break has applied to county and town taxes for decades, but was expanded to school districts last year by the state Legislature. The exemption would have automatically affected 90 veterans who served in combat or in non-combat roles during wartime within the Oysterponds school district, saving them $427 on average, school officials said.
Another 46 veterans would also be eligible to apply for the exemption, if the district decided to opt into the program, Southold Town Assessor Kevin Webster said at the meeting.
Although Mr. Webster explained the rules of the tax break to the board, some board members were wary of approving the exemption.
There was also one resident that spoke out against the exemption during the hearing and said he believed veterans didn’t deserve special treatment.
“Big deal, you served,” said John Brady, who said he was a veteran living in East Marion. “You had a good time doing it. I know I had a good time doing it.”
Mr. Brady went on to say that the board was handing out too many tax breaks.
“We can’t afford it,” he said, noting that veterans he knew in the area weren’t asking for an exemption. “Pay your fair share and shut up.”
Board members said Mr. Brady was the only veteran who spoke at the hearings.
The board later decided to delay voting on the exemption until board members received more information about the financial impact it would have on the rest of the community.
School boards have until March 1 to opt into the program in order for the tax breaks to go into effect in the next fiscal year. Board member Linda Goldsmith, who would be eligible to receive the proposed exemption, said she would ultimately abstain from the board’s decision.
Earlier this month, the Southold school board became the first local district to approve the veterans tax exemption program.
In addition to the veterans exemption, the board also briefly discussed another tax break that would have granted a temporary 50 percent reduction on the taxes paid for improvements and additions worth more than $50,000 to businesses.
Ms. Thomas praised the idea, noting that the taxes would gradually be restored to full assessed value after 10 years.
“Half of something is better than all of nothing,” she said. But Ms. Goldsmith said she didn’t want to see new businesses “congesting” the area due to the new tax incentives.
The board voted 6-1 opt out of the business exemption program, with board president Dorothy-Dean Thomas casting the lone vote in support of the exemption.
BOARD ENDORSES PLAN FOR CAPITAL IMPROVEMENTS FUND
After failing to pass a referendum on a capital improvements fund by just 12 votes last year, the district is set to try again at this year’s budget vote.
School officials said they will be more proactive about promoting and explaining what a capital fund would mean for taxpayers. Confusion likely played a role in the proposal’s failure last year, officials said.
“This is not new tax money,” Superintendent Richard Malone said. “There will be no increase in the taxes.”
A capital improvement fund line in the budget would be a way for the district to address facility repairs while also managing its fund balance, district officials said.
Currently, Oysterponds has about $700,000 left over in a general fund balance, Mr. Malone said. Auditors will likely take issue with such a high fund balance, he said, adding that the state may cut off aid to the district because of their substantial reserves.
The state expects Oysterponds to have a fund balance of roughly $220,000, he said.
The capital improvement line would set aside some of those reserves to only be used on repairs at the school, including aging windows, a leaky roof and the boilers, Mr. Malone said.
Capital funds could only be used for those types of projects and could not be put toward another other expenses like supplies or salaries, he said, adding voters would ultimately have to sign off on the projects before the money could be spent.
“Some people see this as a slush fund, but it’s the exact opposite,” Ms. Thomas said.
TAX LEVY INCREASE TO STAY UNDER CAP
The Oysterpond School District’s tax levy for the 2014-15 school year will stay just under the state-mandated 2 percent tax levy cap, according to a proposed budget overview discussed at the school board’s meeting Tuesday.
The tax levy is proposed to increase by 1.93 percent, said Superintendent Richard Malone.
Mr. Malone said an unexpected influx of students this year forced the district to go over its planned budget for student services. Next year’s budget will account for the higher student population, he said.