By Christopher Twarowski and Timothy Bolger

It’s that time of year again: The day that determines the destiny of a large chunk of your family’s finances next year. The day that culminates months of planning, conferring and strategizing among parents, teachers, students and school officials. The day when taxpayers across the Island can stage a revolt simply by saying, “No.” Or they can scream. Yes, it’s school budget time across New York State.

Next week, residents from across Long Island’s 124 school districts will have a chance to decide how much of their money goes toward running their districts, as well as who sits on the school boards and will spend that money; May 19 is school budget vote day. Nassau and Suffolk rank among the most-taxed counties in the nation. In Nassau, school taxes account for 61 percent of residents’ tax bills. In Suffolk, they make up about the same. Despite the big numbers, less than 20 percent of eligible voters actually cast votes at the polls.

Yet this year’s vote couldn’t come at a more crucial time for Long Islanders to weigh in. The U.S. economy is in recession. Many states and local governments across the country are money-strapped and facing deficits. Property values have been in decline. Retirement plans have disappeared. Unemployment has been on the rise, and economic forecasts predict the situation will get worse before it gets better. LI school districts’ recent shouldering of more than $20 million to help fund a $1.5 billion bailout of the Metropolitan Transportation Authority is a hefty new strain. And new federal stimulus funds will eventually dry up. Long Islanders are stuck with tough decisions: They want the best education and services for their children but don’t want to pay more in taxes.

Lorraine Deller, executive director of the Nassau-Suffolk School Boards Association, says that the vote is about a lot more than just dollars and cents.

“Pulling that lever is not only a decision as to whether or not your tax bill is going to go up or down, it is also something that really is responsible for the quality of your community’s public schools and is obviously reflective in your quality of life, the value of your home, etc., etc.,” explains Deller. “This is a very serious decision.”

Lurking in the shadows of that decision is a timeless battle between taxpayers and school district officials waged since the inception of the public school system itself: the fight for transparency. Parents and property owners want more access to information. They also believe they should have more say in the process, since they’re the ones paying for most of it. A major gripe has been the inability to vote on district officials, teachers and personnel contracts. District administrators do their best to fulfill their district’s needs, protect their staff and appease the taxpayers. And pass a budget.

It’s a costly tightrope walk. If a budget gets voted down, it could mean slashes for extracurricular activities and programs, such as sports and music, and supplies. Critics of the process charge it’s the top-heavy salaries of district officials and personnel that should be on the chopping block instead. The majority of LI school districts’ superintendents earn upward of $200,000 per year, according to state filings. A handful surpass $300,000. Other administrators, such as principals, easily top $100,000.

Fred Gorman of Smithtown, a local civic leader and founder of Long Islanders for Educational Reform, a school tax protest group, says enough is enough. He wants taxpayers to send a message on May 19 to districts’ school boards and elected officials in Albany, who he charges are in the pockets of well-funded teachers’ unions.

“Nascent school boards have taken over the political system, they have corrupted our politicians and they are sucking the lifeblood out of Long Island,” says Gorman. “I would like everyone to stand up and say, ‘No.’”

This year, New Yorkers are armed with the most information they’ve ever had about their school districts’ financial dealings prior to hitting the polls. Due at least in part to closer regulatory oversight on school districts in the wake of massive fraud at the Roslyn School District in 2004, new requirements and websites grant taxpayers a clearer, and more accessible, window into what naysayers claim are still shadowy and distorted operations. Despite the increasing sunlight, however, even top watchdogs say the view isn’t free from darkness.

Districts, at the very least, can make it difficult for residents to see everything that’s going on. They can still blur the lines. They can still distort the truth. They can still fudge it.

Checkered Past

New York State has Long Island to thank for the increased scrutiny of school districts’ budgets by taxpayers and regulators. In 2004, Nassau’s Roslyn School District became the ground zero of fraud and waste when it was discovered several district officials misappropriated more than $11 million of its funds for personal use. Roslyn Superintendent Frank Tassone, Assistant Superintendent for Business Pamela Gluckin and Account Clerk Deborah Rigano (Gluckin’s niece) were arrested in the massive scheme, which was epic in proportion. An intense forensic audit of the district by the New York State Comptroller’s Office found that it had paid almost $6 million for cash withdrawals and purchases made on the personal credit cards of Tassone, Gluckin, Rigano and at least 10 of their family members and friends. More than $1 million was used for payments on their private mortgages and loans.

Less than a year later, state comptroller auditors discovered $6.4 million in inappropriate and unapproved spending by district officials at the William Floyd School District in Suffolk. Five district officials were arrested and its Assistant Superintendent for Business Daniel Cifonelli and Treasurer James Wright pleaded guilty to stealing nearly $1.5 million.

Roslyn sparked greater oversight, starting with a bill proposed by then-LI state Assemblyman and current New York State Comptroller Tom DiNapoli, which, among other mandates that tightened school accountability controls, required the comptroller’s office to audit every school district, BOCES and charter school by 2010. There are 832. It passed into law in 2005.

“What happened in Roslyn got everyone re-engaged in reviewing what would be the appropriate oversight role for school district spending,” DiNapoli tells the Press.  “And what we found [was] while the comptroller’s office had the authority to audit school districts, over the years, by and large the comptroller’s office was not doing that, by choice.”

DiNapoli says his office will hit that goal in March 2010. He warns, however, that the audits will not catch everything.
“The audits really are a level of oversight and review; they’re not in every case a forensic audit or a very detailed audit,” he explains. “So this certainly in and of itself is not going to prevent any problems from happening, but it certainly gives taxpayers an added level of assurance that someone is looking over the shoulders of what’s happening in the local school districts.”

Last year, DiNapoli launched Open Book New York, a website containing searchable databases of spending by more than 100 state agencies and more than 60,000 state contracts. It also includes school districts.

And there are other groups shining sunlight through the clouds on school districts as well. The Empire Center for New York State Policy, an Albany-based think tank and project of the nonprofit Manhattan Institute for Policy Research, provides an easily accessible, easily searchable database for government payrolls, labor contracts and expenditures across the state—including school districts’ teachers and superintendents—through its SeeThroughNY Web portal.

Tim Hoefer, communications director for the Empire Center, believes taxpayers’ ability to follow school districts’ money is not only critical, it’s their right.

“As taxpayers, we have a right to know where this money is going—whether it’s payrolls or expenses or things laid out in contracts. The contracts end up being fairly contentious,” he explains. “There are schools that are being very prudent about how they’re spending and how long the contracts are signed for, and then there are schools that are signing four- to five-year deals, there are schools that are signing one- or two-year deals. There are schools that are averaging 6, 7, 8 percent raises.”

Hoefer adds that this is the first time taxpayers have easy access to this data prior to the budget vote as the first contracts were posted in July 2008. And more contracts are constantly being posted, he says.

Know Your Rights

Taxpayers’ access to information about their school districts’ finances is protected by law. School districts are required to submit Property Tax Report Cards to the State Department of Education. The reports include budget expenditures, property tax increases and enrollment changes. School boards must approve and submit the data to the state no later than 24 days prior to the statewide voting day. The state education department must then compile the data and make it available electronically at least 10 days prior to the vote. The law states the data must also be sent to newspapers and attached to copies of the proposed budgets made publicly available by school districts. It’s also available through the state’s website. The Press received the figures May 10.

The law also requires the state education department to prepare a statewide compilation of the salaries and other personnel costs of certain school administrators and make it publicly available. Those figures are available here.

Even with the increased transparency, however, the data can be confusing. Two important percent changes on the reports that taxpayers should pay attention to are: Budgeted Spending (expenditures), the district’s total spending amount appropriated under the school district budget for the school year; and the School Tax Levy, the difference of total spending minus other revenues. For the ensuing school year, this figure is the district’s estimate. For the previous year, the figure is the actual levy.

School districts can hide substantial increases in spending by interchanging these terms on their budget proposals, a practice the Long Island Press discovered was rampant among many LI school districts. [See Math Sidebar] Districts will simply state the smaller of the two figures when touting their fiscal responsibility and many times not mention the greater figure.

For example, Wantagh School District prominently features its tax levy of 4.35 percent, but not its 5.80 percent increase in total spending from last year. In contrast, Shoreham-Wading River School District touts its 3.76 percent change in total spending but fails to mention its estimated 26.85 percent increase in its proposed tax levy for next year. Other districts do the same. Neither district’s superintendent returned calls seeking comment as of press time.

Deller says that it’s the expenditure figure taxpayers vote on and the figure most school districts list. She suggests that the scenario described by the Press may be less a veiled attempt at deceiving taxpayers to get the budget passed and rather an example of individual districts reflecting the desires of their respective communities. She emphasizes that overall the estimated budgets up for a vote next week are, “The tightest we’ve ever seen, frankly.”

Gorman disagrees, charging that school budgets in general are lined with an additional 4 to 10 percent of “built-in fat.”

Show Me The Money

New York State has the highest local taxes in America—79 percent above the national average, according to the New York State Commission on Property Tax Relief. Outside of New York City, 62 percent of property taxes are school property taxes. Nassau County is the second-highest taxed county in the nation, with the average homeowner paying more than $7,700 in property taxes annually. Suffolk ranks 12th, according to the Commission.

The Commission was created in January 2008 by former New York Gov. Eliot Spitzer to address the state’s high tax problem. Its main objectives: to examine the causes of high property taxes; identify ways to make the state’s system fairer; and develop an effective and fair school property cap to “hold the line on property tax growth.”

Increased oversight, coupled with tough economic times and a burning memory of Roslyn, seem to have had an impact this year, statewide.

Nassau County Executive Tom Suozzi, the Commission’s chairman, recently commended school districts across the state for a lower-than-average proposed property tax increase of 2.1 percent for 2009-2010. Citing data calculated from the state’s Report Cards, Suozzi said there has been a downward trend in statewide average proposed school property tax increases annually since the 2004-2005 school year, down from 8.7 percent.

“There’s obviously a very positive trend in the tax increases that have taken place,” Suozzi told reporters during a conference call on May 6. “But even with this action, it’s still an unsustainable burden.”

Historically, local school districts received a larger percentage of funding from state aid, with less from the federal government. These funds lower tax levies on property owners. Much state aid for next year, however, was slashed during state budget negotiations—funds crucial to local school districts. Earlier this year that money was restored through federal stimulus funds. And additional federal funding for special education—which historically hasn’t been properly funded but is one of the fastest-growing areas of school budgets—is finally coming through, says Deller. On May 12, New York Gov. David Paterson announced the U.S. Department of Education approved the state’s application for approximately $2 billion more in federal stimulus funding for education. Deller explains that during the budget building process this year, districts were advised to project costs and sustained programs for three to four years out, in anticipation of the stimulus funds’ drying up in the future and other unknowns.

Paterson has proposed legislation based on the Commission’s recommendation for a 4 percent cap on school property tax. He then kicked off a statewide tour to promote the legislation. His first stop was Long Island.

“New York is the highest taxed state in the nation and we can no longer afford to ignore the reality that property taxes are driving people and businesses out of our state,” said Paterson. “This trend is disrupting our quality of life because it is straining family budgets, separating grandchildren from grandparents, and discouraging the entrepreneurship that creates innovation and jobs. On Long Island, as in other parts of the state, the story is no different: New Yorkers are calling on their elected officials to come together to comprehensively address this issue.”

The Commission submitted a final report to Paterson in December 2008 that consisted of 32 recommendations, including the cap. Paterson’s cap legislation passed the state Senate in August 2008, but it has not yet been picked up by the state Assembly. The Empire Center also supports such a cap.

A handful of districts didn’t seem to get the memo, however. Suozzi pointed out that 59 districts had proposed property tax increases piercing 4 percent. He sent a letter to district superintendents asking them to explain their expense growth. Eighteen of those 59 districts, approximately 32 percent, are on Long Island.

The majority of school districts on the Island have scaled back their wish lists, however. Some are seeking less funds than previous years. Greenport Union Free School District’s proposed budget seeks 3 percent less than the previous year in expenditures. Many of the cuts, according to the district’s budget posting on its website, came from supplies, services and travel expenses. Funds were also reallocated to other areas. Supplies for boys’ baseball rose from $800 last year to a proposed $4,600, an increase of 475 percent, for example. Supplies for lacrosse, $3,000 in 2008, were slashed completely.

Your Wallets Or Your Children

New York spends more per pupil than any other state, according to the Commission. And despite the downward trend in the statewide average proposed school property tax increases, it found that overall expenditure growth has increased at an annual compound growth rate of 6 to 7 percent in recent years—while student population has been declining.

On Long Island, school districts spent approximately $21,853 per student in the 2008-09 school year, according to a 2008 report by Trudi Renwick, senior economist at the Fiscal Policy Institute, a research group. The study found a significant range in spending estimates, however: from $80,274 in Bridgehampton’s tiny school district to $15,623 in Floral Park-Bellerose.

But how much is too much for Long Island taxpayers? Will they simply bite the bullet once again? Will they stage a revolt?

When a budget fails, the district has one more chance to get it through. It can resubmit or submit anew. If a budget still doesn’t pass, then the district operates on a contingency budget. Programs and staff are terminated. The district doesn’t have a say over their expenditures, the state takes control. This was the case last year at Wantagh and several districts in Suffolk.

It’s uncertain how Long Islanders will react next week. But one thing is certain: The fight for transparency will not end anytime soon.

“Transparency empowers citizens with more information to make more informed choices when they go to vote on a school budget,” says DiNapoli. “My hope is that, especially at a time like this when people are very concerned about tax dollars, that at the local level people are going to school board meetings, asking the right kind of questions—many communities have budget advisory committees that help the school board, the administration develop the budgets for the coming year, making sure that the school districts adhere to the requirements of the School Accountability Act.”

Math Class

Come budget time, many LI school districts publicize the smaller of the two annual percents of change—either the estimated tax levy increase or the budgeted spending increase—between last year’s budget and the proposed 2009-2010 budget when presenting the facts. Here are both figures for school districts with the biggest increases and decreases:

Top 5 Biggest Estimated Tax Levy Increases

1. Shoreham-Wading River Central School District
26.85 %, from $35,115,870 to $44,543,528 (3.76% budgeted spending increase)
2. Bridgehampton Union Free School District
12.03 %, from $7,551,075 to $8,459,176 (1.41% budgeted spending increase)
3. East Rockaway Union Free School District
8.08%, from $22,852,032 to $24,698,304 (2.28% budgeted spending increase)
4. Wyandanch Union Free School District
6.74%, from $17,359,034 to $18,528,350 (.64% budgeted spending increase)
5. Merrick Union Free School District
6.38%, from $30,037,204 to $31,953,578 (4.39% budgeted spending increase)

Top 5 Biggest Budgeted Spending Increases

1. Amagansett Union Free School District
6.89%, from $7,448,339 to $7,961,717 (3.84% est. tax levy increase)
2. Wantagh Union Free School District
5.80%, from $47,223,558 to $49,275,921 (4.35% tax levy increase)
3. Easthampton Union Free School District
5.60%, from $59,096,040 to $62,402,556 (5.36% est. tax levy increase)
4. Floral Park-Bellerose Union Free School District
5.33%, from $25,060,023 to $26,395,722 (2.80% est. tax levy increase)
5. Westbury Union Free School District
4.96%, from $98,724,521 to $103,625,288 (3.93% est. tax levy increase)

Top 5 Budget Decreases

1. Oysterponds Union Free School District
-8%, from $6,155,678 to $5,663,286 (-1.57% est. tax levy increase)
2. Lawrence Union Free School District
-3.98%, from $95,476,987 to $91,680,810 (2.47% est. tax levy increase)
3. Greenport Union Free School District
-3.18%, from $14,275,044 to $13,820,704 (-2.14% est. tax levy increase)
4. Sachem Central School District
-1.86%, from $279,401,007 to $274,194,940 (-2.02% est. tax levy increase)
5. Deer Park Union Free School District
-0.06%, from $94,471,150 to $94,412,960 (-1.47% est. tax levy increase)

Source: New York State Education Department, 2009-10 Property Tax Report Card Data