senate Bill S1961A

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:
A7760
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

Votes

Sponsor Memo

BILL NUMBER:S1961A

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
municipalities 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--A

                       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  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

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.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01518-02-3

S. 1961--A                          2

  (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
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 is hereby authorized to establish an ener-
gy  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 provided, however,  that
no  such fund shall be established unless approved by a majority vote of
the qualified voters of the district present and voting  on  a  separate
ballot  proposition  therefor at either a special district meeting which
the board of education may call for such  purposes,  or  at  the  annual
district  meeting  and  election,  to be noticed and conducted in either
case in accordance with the provisions of article 41  of  the  education
law.  Further,  the  notice  of  the  special district meeting or annual
district meeting and election,  as  applicable,  at  which  such  ballot
proposition shall be presented to the voters, shall explain the means by
which  moneys  shall  be  paid  into and withdrawn from such fund as set
forth hereinafter in subdivisions (a) and (c) of this section.    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 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 receivable by the school district
for such fiscal year is not required  to  prevent  an  increase  in  the
school  tax  levy  from  the immediately preceding 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 is hereby authorized 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, provided, however, that no such deposit
shall be made unless approved by a majority vote of the qualified voters
of  the  district  present  and  voting on a separate ballot proposition
therefor at either a special district meeting which the board of  educa-
tion  may  call  for such purpose, or at the annual district meeting and
election, to be noticed and conducted in either case in accordance  with
the  provisions of article 41 of the education law.  Further, the notice
of the special district meeting or annual district meeting and election,
as applicable, at which such ballot proposition shall  be  presented  to
the  voters,  shall explain the means by which moneys shall be paid into
and withdrawn from such fund as set forth  hereinafter  in  subdivisions
(a) and (c) of this section.
  (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

S. 1961--A                          3

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 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 determined provided, however,  that  no
such withdrawal shall be made unless approved by a majority of the qual-
ified  voters  of  the  district present and voting on a separate ballot
proposition therefor at the annual district  meeting  and  election,  in
accordance with the provisions of article 41 of the education law.
  (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
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 provided, however, that no such withdrawal
shall be made unless approved by a majority of the qualified  voters  of
the  district present and voting on a separate ballot proposition there-
for at the annual district meeting and election in accordance  with  the
provisions of article 41 of the education law.
  (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 to be expended  for  any  other  lawful  purpose,  provided,
however,  that  no  such withdrawal and expenditure shall be made unless
approved by a majority vote of the  qualified  voters  of  the  district
present and voting on a separate ballot proposition therefor at either a
special  district meeting which the board of education may call for such
purpose, or at the annual district meeting and election, to  be  noticed
and  conducted in either case in accordance with the provisions of arti-
cle 41 of the education law, 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.
  (d)  Determinations  by  the  board of education to pay money into the
energy system tax stabilization  reserve  fund,  authorizations  by  the
board  to  withdraw  money  from the fund, and decisions by the board to
submit a ballot 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.
  (e)  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

S. 1961--A                          4

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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