‘The Devilish Details’ of New Law for Village Dissolution
The sponsors call it, the “Empowerment Act” for short, but local governments are calling it, the “Disenfranchisement Act” because the sweeping legislation passed this June, going into effect in March 1020, requires voters to vote to dissolve or consolidate local government before they know whether such actions would save money, or not.
“There’s a lot of confusion about the Act and it’s up to you to educate your residents so they’ll know that signing a petition for dissolution sets into motion a complicated, expensive process where the cart is before the horse,” said Wade Beltramo, special counsel for the New York State Conference of Mayors (NYCOM) to a roomful of mayors and village officials from Nassau, Suffolk and Westchester Counties at a NYCOM meeting held at Mineola High School on Oct. 29. Mr. Beltramo spent the evening giving a quick course in the new act, which is summarized below.
New York State has experience with village dissolutions. Under the old law and since 1972, 19 villages across the state have dissolved. When a village is dissolved, residents still need garbage picked up, roads plowed and maintained, police protection, fires fought, sewage whisked away, building codes enforced and zoning laws upheld. Mr. Beltramo said that ironically what happens next is that special districts, usually under town oversight, are created to provide those services. For every one village dissolution, 3 to 8 special districts are formed.
Residents of villages pay town-wide taxes, even if they receive few services directly from the town. Because village governments provide many services, village residents are in essence subsidizing town government. Often, when a village dissolves, and the town has to pick up the costs of those services, town residents’ taxes go up.
Actually, according to Mr. Beltramo, while the Act was pushed through as a property tax saving measure, it only applies to 12 percent of the property tax pie. He said, “It’s not manna from heaven.”
Under the new Act, if 10 percent of the “electors” sign a petition calling for a dissolution referendum, the village clerk has 10 days to determine the validity of the signatures. However, the collection of signatures has no time limit and those circulating the petition may or may not be residents. For small villages with 500 or less electors, 20 percent of the signatures would be required. A village with 500 electors would require 100 signatures, whereas, a village with 600 electors would require 60 signatures.
After petitions are filed, a village board would then be required to enact a resolution calling for a referendum. A vote would be held between 60 and 90 days past the date of the resolution. If the vote fails, dissolution cannot be brought back to voters for another four years. If the vote passes, the village has to develop a plan for dissolution within 180 days. This involves establishing a study committee and hiring a planning consulting firm.
Mr. Beltramo spelled out the following scenario. “Let’s say the village board, after conducting the study concludes that significant savings would not be realized with dissolution and recommends against it. Then what happens?” He says that the plan would go into effect anyway, unless 25 percent of the electors’ petition against the plan within 45 days after the final plan has been accepted. He says, “This is a huge hurdle…and becomes dissolution by default…It’s relatively easy to start the process, but more difficult to turn it around.”
NYCOM is calling for the following amendments to the law before it goes into effect in March.
1. Raise signature threshold for dissolutions to 25 percent. (The old law required 33 percent.)
2. Clarify petition signature process.
3. Do not have a vote without first conducting a study.
4. Lengthen timeframes for conducting study.
5. Allow the democratically elected board to approve or disapprove dissolution after receiving study.
a. Approval of dissolution subject to a mandatory referendum.
b. Disapproval of dissolution subject to a permissive referendum.
6. Require vote to be held at normally scheduled election.
