senate Bill S1961

Amended

Establishes an energy system tax stabilization reserve fund in the Lowville Central School District to lessen or prevent increases in the real property tax levy

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 09 / Jan / 2013
    • REFERRED TO EDUCATION
  • 25 / Feb / 2013
    • AMEND AND RECOMMIT TO EDUCATION
  • 25 / Feb / 2013
    • PRINT NUMBER 1961A
  • 07 / May / 2013
    • REPORTED AND COMMITTED TO FINANCE
  • 12 / Jun / 2013
    • COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • 12 / Jun / 2013
    • ORDERED TO THIRD READING CAL.1313
  • 17 / Jun / 2013
    • AMENDED ON THIRD READING 1961B
  • 20 / Jun / 2013
    • PASSED SENATE
  • 20 / Jun / 2013
    • DELIVERED TO ASSEMBLY
  • 20 / Jun / 2013
    • REFERRED TO EDUCATION
  • 08 / Jan / 2014
    • DIED IN ASSEMBLY
  • 08 / Jan / 2014
    • RETURNED TO SENATE
  • 08 / Jan / 2014
    • REFERRED TO EDUCATION
  • 29 / Apr / 2014
    • REPORTED AND COMMITTED TO FINANCE

Summary

Establishes an energy system tax stabilization reserve fund in the Lowville Central School District to lessen or prevent increases in the school district's real property tax levy resulting from decreases in revenue due to changes in the amount of or termination of payments in lieu of taxes receivable.

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Bill Details

See Assembly Version of this Bill:
A2613
Versions:
S1961
S1961A
S1961B
Legislative Cycle:
2013-2014
Current Committee:
Senate Finance
Law Section:
Real Property Taxation
Versions Introduced in 2011-2012 Legislative Cycle:
S6835, A9859

Sponsor Memo

BILL NUMBER:S1961

TITLE OF BILL: An act to establish an energy system tax stabilization
reserve fund in the Lowville Central School District to lessen or
prevent increases in the school district's real property tax levy

PURPOSE: To allow the Lowville Central School District to establish a
real property tax stabilization fund out of part of the proceeds of a
payment in lieu of taxes (PILOT) agreement from the Maple Ridge Wind
Farm. Upon termination or decrease of the PILOT payments, transfers from
the fund would ease a transition in the tax levy so that taxpayers do
not have to bear a sudden spike in real property taxes.

SUMMARY OF PROVISIONS:

Section one: The legislative findings section recognizes that the school
district's current receipt of significant PILOT payments from the wind
farm will at some point either terminate, or significantly decrease,
which could result in a massive destabilization of the district's tax
base and the amount of its tax levy to meet current budget levels.

Section two: This section makes definitions of important terms in the
bill, including providing that PILOT payments may mean either PILOTS
under Real Property Tax Law 487 (RPTL Section creating municipalities to
enter into PILOT agreements for wind energy systems) or Subdivision
fifteen of § 858 of the General Municipal Law (authorizing IDA created
PILOT's) and adopting the definition of wind energy systems already
found in Real Property Tax Law § 487.

Section three: (a) This subsection permits the school district to create
a tax stabilization fund by paying into such funds the amount of PILOT
payments received which is not required to prevent an increase from the
real property tax levy over the preceding budget year.

(b) This subsection permits the deposit of PILOT payments already
accrued into the stabilization fund.

(c) This subsection provides limitations on the ability to withdraw from
the stabilization fund as follows (1) no withdrawal may be made in any
year in which PILOT payments receivable equal or exceed those from the
preceding year; (2) for any year in which the amount of payments is less
than the preceding year, a withdrawal may be made in the amount of the
decrease; (3) for any fiscal year in which no PILOT payment will be
made, a withdrawal may be made in an amount not to exceed the PILOT
payment for the preceding year plus the amount, if any, authorized to be
withdrawn in such preceding year.

Other provisions require withdrawals for any other purpose would require
voter approval submitted as a separate proposition and applies existing
controls and reporting requirements over expenditure of district money.

Section four: Makes requirements for information concerning the fund,
deposits into, expenditures from it, and the affect on the tax levy for
purposes of the property tax report card under subdivision seven of
1716 of the Education Law.

Section five: Makes provisions with regard to the real property tax cap
so that use of the fund does not facilitate avoiding such cap.

Section six: Should this act take effect after the last date for
submission of the district's real property tax report card to the
Department of Education, this section makes provision for public notice
of a statement concerning payment into the fund and the effect on the
tax levy.

Section seven: provides for an immediate effective date.

EXISTING LAW: A similar tax stabilization fund was established for the
Oswego community as a result of large PILOT payments from a nuclear
energy facility. (See Chapter 202, Laws of 2001).

JUSTIFICATION: The Maple Ridge Wind Farm in Lewis County, one of the
largest and most successful wind energy enterprises in the United
States, pays an annual PILOT payment of around $8.9 million to munici-
palities and school districts which host wind towers. This PILOT payment
has been one of the leading causes for wide community acceptance and
support of this important alternative energy project.

The Lowville Central School District receives about $3.9 million of this
amount each year. The district has employed this money prudently, using
about $2.7 million each year to keep the tax levy level and allowing the
balance to accrue in fund balance. The PILOT agreement started in the
2006-2007 school year and will end in 2021-2022. At that point, the
PILOT will either terminate completely or be replaced, perhaps by an IDA
sponsored PILOT which would not be as generous. The result would be that
the PILOT at that point would cease to be a windfall and its loss would
become the source of wrenching dislocation in the district's finances.

The district requires the approval given in this bill to accumulate a
tax stabilization fund which will one day be equal to the task of
smoothing the transition that will be required by ramping up the tax
levy over a period of time. Absorbing all of the loss or decrease in the
PILOT in one or two years would cause a severe spike in the tax levy,
dramatic slashing of programs or both. The bill contains significant
safeguards to insure the dedication of PILOT funds for this purpose.

LEGISLATIVE HISTORY: 2011-12 S. 6835 - Passed Senate/A. 9859 - Real
Property Taxation Committee.

FISCAL IMPLICATIONS: None for the State of New York. Positive impact on
the district's fiscal and tax levy stability.

EFFECTIVE DATE: Immediate.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  1961

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 9, 2013
                               ___________

Introduced  by  Sen.  GRIFFO -- read twice and ordered printed, and when
  printed to be committed to the Committee on Education

AN ACT to establish an energy system tax stabilization reserve  fund  in
  the Lowville Central School District to lessen or prevent increases in
  the school district's real property tax levy

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Legislative findings. The legislature hereby finds that the
private development and ownership of wind energy systems located  within
the  Lowville  Central  School District may result in instability in the
real property tax base and the budgets of the district due to the uncer-
tainty with the assessments of such wind energy systems at the time  the
payments in lieu of taxes terminate.
  S 2. Definitions. As used in this act:
  (a)  "Board  of  education" or "board" means the board of education of
the Lowville Central School District.
  (b) "Energy system tax stabilization reserve fund" or "fund" means the
energy system tax stabilization reserve  fund  established  pursuant  to
this act.
  (c)  "Payments  in lieu of taxes" or "payments" means payments in lieu
of taxes receivable by the school district pursuant to contracts entered
into in accordance with section 487 of the  real  property  tax  law  or
subdivision  15  of section 858 of the general municipal law on any wind
energy system located wholly or partially within  the  Lowville  Central
School District.
  (d)  "School district" or "district" means the Lowville Central School
District.
  (e) "Wind energy systems" shall be defined as in section  487  of  the
real  property  tax law and shall include the land upon which the system

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01518-01-3

S. 1961                             2

is located, any equipment used in such generation, and equipment leading
from the system to the interconnection with the transmission system.
  S 3. The board of education, without voter approval, is hereby author-
ized  to  establish  an  energy system tax stabilization reserve fund to
lessen or prevent increases in the school district's real  property  tax
levy resulting from decreases in revenue due to changes in the amount of
or  termination  of  payments  in lieu of taxes receivable by the school
district. Moneys shall be paid into and withdrawn from the fund, and the
fund shall be administered, as follows:
  (a) For any school district fiscal year commencing after the effective
date of this act and after the establishment of the  energy  system  tax
stabilization  reserve  fund,  the  board  of  education,  without voter
approval, may determine that there shall be paid into the  fund  all  or
any portion of the amount by which the payments in lieu of taxes receiv-
able  by  the  school  district  for such fiscal year is not required to
prevent an increase in the school tax levy from the immediately  preced-
ing  fiscal  year,  provided that no payment into the reserve fund shall
cause the balance of the fund to exceed 100 percent of  the  budget  for
such  immediately  preceding  fiscal  year.  Such  determination  may be
amended to reduce the amount paid into the fund in the  event  that  the
district's original proposed budget is not approved by the voters.
  (b)  The board of education, without voter approval, is hereby author-
ized to make a one-time deposit into the energy system tax stabilization
reserve fund in an amount not to exceed the  balance  over  any  maximum
allowable balance as required by any other law that accrued prior to the
establishment  of  the energy system tax stabilization reserve fund as a
result of the receipt of any payment in lieu of taxes.
  (c) Moneys may be withdrawn from the energy system  tax  stabilization
reserve fund subject to the following limitations:
  (1) For any fiscal year for which payments in lieu of taxes receivable
by  the  school  district  equal  or  exceed the amount of such payments
received for the immediately preceding fiscal year, no amount  shall  be
withdrawn from the fund.
  (2) For any fiscal year for which payments in lieu of taxes receivable
by  the  school  district  are  less  than  the  amount of such payments
received for the immediately preceding fiscal year, the board of  educa-
tion,  without  voter approval, may authorize a withdrawal from the fund
in an amount not to exceed the amount of the payments received  for  the
immediately  preceding  year  less the amount of the payments receivable
for the fiscal year for which the budget and tax levy  is  being  deter-
mined.
  (3)  For any fiscal year for which the school district does not antic-
ipate receiving any payments in lieu of taxes, the board  of  education,
without  voter  approval, may authorize a withdrawal from the fund in an
amount not to exceed the amount of such payments received for  the  last
preceding  fiscal  year  for  which such payments were received plus the
amount, if any, which the board of education authorized to be  withdrawn
from the fund for such last preceding fiscal year.
  (4)  Notwithstanding  paragraph 1 of this subdivision, and in addition
to any withdrawal from the fund authorized pursuant to paragraph 2 or  3
of  this  subdivision,  moneys  may  be  withdrawn from the fund for any
fiscal year in such amount and for such purposes as may be set forth  in
a  separate proposition submitted by the board of education and approved
by the qualified voters of the school district.
  (c) Determinations by the board of education to  pay  money  into  the
energy  system  tax  stabilization  reserve  fund, authorizations by the

S. 1961                             3

board to withdraw money from the fund, and decisions  by  the  board  to
submit  a  proposition  to  the voters authorizing a withdrawal from the
fund shall be made on or before the last date provided by  law  for  the
submission  to  the  state education department of the school district's
property tax report card pursuant to subdivision 7 of  section  1716  of
the education law.
  (d)  The  moneys  in  the energy system tax stabilization reserve fund
shall be deposited, invested and accounted for in  the  manner  provided
for  in  subdivisions  2  and  6 of section 3651 and section 3652 of the
education law.
  S 4. The property tax report card  prepared  by  the  school  district
pursuant  to  subdivision  7  of section 1716 of the education law shall
contain the following information relating  to  the  energy  system  tax
stabilization  reserve fund: (a) the balance of the fund as of the start
of the current fiscal year, (b) all deposits  or  withdrawals  from  the
fund  for the current fiscal year, (c) an analysis of the impact of such
withdrawals on the school district's tax levy  for  the  current  fiscal
year, (d) proposed deposits and withdrawals for the ensuing fiscal year,
and  (e)  an  analysis of the impact of such proposed deposits and with-
drawals on the projected tax levy for the ensuing  fiscal  year  if  the
proposed budget is adopted.
  S  5. When computing the school district's tax levy limit for a school
year pursuant to subdivision 3 of section 2023-a of the education law:
  (a) The payments in lieu of taxes receivable for the prior school year
shall be decreased by  any  amount  paid  into  the  energy  system  tax
stabilization  reserve  fund for such prior school year and increased by
any amount withdrawn from the fund for such prior school year.
  (b) The payments in lieu of taxes receivable in the coming fiscal year
shall be decreased by the amount to be paid into the energy  system  tax
stabilization  reserve fund for such coming fiscal year and increased by
any amount to be withdrawn from  the  energy  system  tax  stabilization
reserve fund for such coming fiscal year.
  S  6.  Notwithstanding  the  provisions  of subdivision (c) of section
three of this act and section four of this act, if this act  shall  take
effect  later  than fourteen days prior to the last date provided by law
for the submission to the  state  education  department  of  the  school
district's  property  tax  report card for the school district's ensuing
fiscal year, then a determination by the board of education to pay money
into the fund for the ensuing fiscal year may be made on or  before  the
last  date provided by law for the levy of taxes for such ensuing fiscal
year. Upon making such determination to pay money  into  the  fund,  the
board shall cause to be posted on the school district's website a state-
ment  containing  the amount of the payment into the fund and the effect
of the payment on the projected tax levy for the ensuing fiscal year.
  S 7. This act shall take effect immediately.

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