senate Bill S1961B

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:
A7760A
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

Sponsor Memo

BILL NUMBER:S1961B

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
PILOTs) 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--B
    Cal. No. 1313

                       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  --  reported  favorably  from  said committee and
  committed to the Committee on Finance -- committee discharged and said
  bill committed to the Committee on Rules -- ordered to a  third  read-
  ing,  amended  and ordered reprinted, retaining its place in the order
  of third reading

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

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01518-05-3

S. 1961--B                          2

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
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 the sum of twelve million dollars. 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
authorized or required by any other law that accrued prior to the estab-
lishment 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 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  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:

S. 1961--B                          3

  (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 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.
  (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.
  (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.  At  the same time that the property tax report card prepared by
the school district pursuant to subdivision 7 of  section  1716  of  the
education  law is filed and made publicly available, the school district
shall also prepare, file with the commissioner  of  education  and  make
publicly  available  in the same manner as required for the property tax
report card, a report which  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 with-
drawals for the ensuing fiscal year, and (e) an analysis of  the  impact

S. 1961--B                          4

of  such proposed deposits and withdrawals 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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