Archive: News

Stress about catching novel coronavirus is bad enough.  But the impact of the pandemic has brought a lot of different kinds of stress, especially money worries.  With non-essential businesses closed and public gatherings pretty much banned, a significant number of people are taking big hits to their incomes that won't even begin to be addressed by the $1,200 checks promised by the federal government.  That worry doesn't extend only to individuals -- the taxing authorities in Lansing have all been working on their next budgets.  And all reasonable assumptions about probable revenue in their next budget year has flown out the window in the wake of COVID-19.

"It has shifted drastically since our conversations before March 16" said Lansing School Superintendent Chris Pettograsso at the April 6th Board of Education meeting. "We've been having a lot of conversations with faculty, with the union, with each other, a leadership team because we'd be looking at making some difficult decisions coming up."

"We're talking about having to make reductions at a time when student needs are going to be higher. So how are we balancing that? We're looking at staff structures and needs as well," School Business Administrator Kate Heath told the school board last week. "The conversations I'll be having with you and Chris will be having with you moving forward will be around the tax cap. Where do we want to hit for our levy, the use of reserves and fund balance to offset some of those costs, and what that might look like long-term. And then we'll be having conversations with the community about what the priorities are as we move forward."

Heath said current figures make it appear there will be about a $25,000 reduction in state aid from the Governor's proposed budget to the one approved by the State Legislature.  But she added that Albany is threatening a 'pandemic adjustment' to state school aid.  She said that it nearly identical to the 'gap elimination' that deprived the schools of millions of dollars in anticipated state aid about a decade ago.  She said the state intends to reevaluate state aid three times this year, reducing school aid if state revenues fall too low.

"There were just some slight reductions across the board," Heath told the School Board. "However, it's these midyear adjustments that we don't know what they are. That is the biggest concern. If revenue is 1% or more less than what they anticipated, they're going to be making an adjustment to state aid across the state."

Heath calculated a 'worst case scenario' of a $540,000 drop in state aid, but stressed that it is only an estimate.  That half million dollars would have a significant impact on school revenues.

Additionally the school board and budget vote has been delayed by Albany until at least June 1st, and widespread layoffs due to the pandemic will make it hard for property owners to pay the tax when it comes due.  heath noted that at the March 9th school board meeting she was anticipating a $120,068 shortfall in the upcoming budget.  Now, with state aid pandemic cuts she estimates -$660,000.

There will be some savings through staff attrition due to retirements.  Specifically a high school World Languages teacher and a reduction of the Enrichment program will provide some savings through attrition.  Cuts to the summer curriculum is being considered.  Central business office services contracted from TST BOCES are expected to be slightly less.  Additionally, an anticipated 7% rise in health insurance costs will now be 6.5%.

"I don't want to call dire straits quite yet, but it is different than what we'd certainly been expecting just a month ago," Pettograsso observed. "The economic impact is, is pretty significant in our community right now."

The school district isn't the only Lansing taxing authority thinking about making 'difficult decisions'.  Both Town and Village officials are talking about reducing municipal projects that were slated for the next fiscal year.  Almost two weeks ago Village of Lansing Mayor Donald Hartill told the Board of Trustees that some projects would likely be delayed due to anticipated revenue reductions caused by COVID-19.  He said that the Village can withstand some reductions for a limited period of time.

"We do have comfortable fund balances," he said. "We could actually survive a year if we had to, without any real problems. We have no debt and the roads are in pretty good shape."

The Town and the School District also have healthy reserves.  Lansing Town Supervisor Ed LaVigne said Wednesday that even though sales and mortgage taxes are anticipated to take major hits because of closures precipitated by the coronavirus, town revenues are fairly healthy, at least right now.

"We're very healthy with our sales tax on balance right now," he said. "Right now about 83% of sales tax went to the highway 70% mine to code and planning now that we've up 80% / 20%.  We have to be concerned about a mortgage tax even though Horizons has got sold over $6 million. So hopefully that'll add to the mortgage tax, a little bit - we'll see.  We're going to try to track that. We would have to be concerned about all the revenue streams coming in, but obviously mortgage tax is a big one."

But Councilman Joseph Wetmore was fearful that restrictions imposed on the public by Albany are likely to last much longer than state and national politicians are claiming.  He said that the City of Ithaca is anticipating between 12% and 20% less revenue, and Lansing may suffer the same revenue losses.

"Let's start with the mortgage tax because right now we're in a situation where people are inclined to not write mortgages because there's a 90 day goal when people actually have to pay on their mortgages and that has really cut back on the mortgage market a lot. In addition, people not wanting to buy houses at the moment they have that. So those two factors mean that we're going to see some hit on the mortgage tax -- I'm not sure what. But it's definitely going to be down considerably depending on how long this all lasts. Sales tax... the city comptroller is expecting somewhere between five and 15% for the year, assuming that we get back on track in June, which I think is an optimistic assumption."

But LaVigne reported that while the barrage of new developments need to be carefully monitored, the Town is in good fiscal shape.  He noted that Recreation Department programs are largely funded by fees charged for participation, so while there will be a considerable loss of Rec program income, there also won't be expenses for cancelled programs.  Parks & Recreation Supervisor Patrick Tyrrell warned that there could be some additional cleaning expenses because things like bathrooms and other park facilities now have to be scrubbed down frequently and vigorously.  LaVigne said he has been talking to Highway Superintendent Charlie Purcell about possibly reducing planned road maintenance that is not essential in the coming year.

LaVigne also affirmed that the Town is in generally good shape, with enough money in the fund balance to pay town expenses for close to six months, and additional cash in reserves.

"How about some good news?" LaVigne said at Wednesday's Town Board meeting. "Our fund balance is at 5.4 months or six months. That doesn't take into account the over $150,000 we have in the reserve to pay for equipment among other things. We're in good shape there. Your sales tax is 8.4 months. So we have healthy reserve there also -- those are two funds right there. The thing with mortgage tax, two years ago we budgeted 250 and it came in at 529.  This is why we're so conservative with our revenues. We're very conservative, and we overestimate are our expenses for that reason."

Meanwhile many residents are wondering if and how they are going to be able to pay their property taxes because of lost wages and jobs resulting from COVID-19.  Officials at the taxing authorities have mentioned this possible obstacle, but have not said what, if anything, they will do to adjust for it.

"Of course, we're all cognizant that there's going to be lots of personal financial problems, unemployment... all sorts of things that people will be struggling with in our community," said Board of Education President Christine Iacobucci.

The bottom line for the Lansing taxing authorities is that they will probably have to do less with less.  Normally reduced revenue streams end up raising tax levies and the amount that the taxing authorities pull from reserve funds to make up the shortfalls.  But with so many residents struggling financially the taxing authorities may be facing reductions from both ends, and that is going to mean reductions in services.  At the same time, conservative planning has kept the Lansings in pretty good shape, so none of the taxing authorities within Lansing borders are in imminent distress.

v16i16