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Lansing's Board of Education (BOE) voted Monday to set the tax rate at $17.76 per $1,000 of assessed value at their meeting Monday.  That will bring $165,000 extra dollars to the district, above the $14,729,065 they said they needed from taxpayers when the $22,838,912 budget was passed last Spring.

"What you put out there using the word 'proposed' was a tax levy of $14,729,065," explained Business Administrator Mary June King.  "That was projected to be at a tax rate of $17.96 per thousand dollars (of assessed value).  What happened is that the value of the assessed property in the district is actually higher than the County Assessor's office had estimated for Mr. Klemm in March.  I spoke with him and he said that is his policy, that he will always underestimate it because the opposite would be a nightmare for us."

(Left to right)  Glenn Cobb, Richard Thaler, David Dittman, Sandi Dhimitri, BOE President Anne Drake, Superintendent Stephen Grimm, Glenn Swanson, Michael Cheatham

The board was split on whether to take what they said they would take in May, or leave the tax rate as-is to produce as much as $330,000 above that amount.  Some board members wanted the extra money to refill empty reserves that have been depleted over the past few years, and to guard against uncertainties in state air, fuel costs, and financial market fluctuations.  But others said that after years of mismanagement it is time to rebuild the community's trust in the board.

The reserves have been depleted year after year as the BOE has struggled to keep taxes down without seriously addressing spending.  Last year poor budgeting and overspending meant that about $2.5 percent of the rise in the 2008-2009 budget is to pay back the overspending from 2007-2008.  While over a million dollars were cut from the rollover budget (what it would cost this year to do exactly what we did last year -- no rise, no drop in hiring, materials, services, etc.), the amount Lansing voted to allow the BOE to spend this year was $744,579 more than in '07-'08.

"It's important for me to reiterate that what the voters voted on in May was what we are going to be spending," King reminded the board.  "They didn't vote on anything having to do with the revenues."

King outlined a number of issues that could impact the district if it has no reserve funds.  She cited lower return on investments, an unstable economy, unforeseeable expenses caused by a failing boiler or roof, or rising fuel costs.  She anticipated that state air would shrink next year, and expressed concern about unanticipated inflation and the sad state of reserve funds that were raided to keep from raising takes higher in past years.

"It's not a bad thing to have a savings account when you're moving into a dismal economic time," she said.  "However it's a dismal economic time for everybody so you have to do what's best for the taxpayers."

King said that state aid would probably be safe this year.  She said she was assured by Senator Seward's office and Assemblywoman Lifton's office that state aid is being taken off the table when considering Governor David Patterson's budget cuts to deal with the state's own $6.4 billion deficit.  A representative from the State Aid Planning Board told her that it is not off the table, but will only be cut as a last resort.

But Grimm said that former Lansing Business Administrator Tom Jones showed him statistics on the last five years of state aid to the district.  Each year the state gave Lansing less than promised.

"It's not so much the money," said board member Glenn Cobb.  "I think it's the principal.  We're not being fiscally responsible and we go to the taxpayers and say this is how much we're going to spend.  If we turn around and take more from them I don't know what that is doing for our credibility.  I think that's a big issue for our district right now.  More so than the $300,000 that you might be able to put into the reserves."

But David Dittman said the $300,000 could replenish the reserve fund in a single year, meaning that the taxpayers that incurred the cost would be paying it back, rather than future taxpayers.  "We might as well bite the bullet now since it is already in the rate," he said.  "They already voted on that rate.  And people that voted on that rate had their assessments in front of them when they voted, so they could calculate what their taxes were."

Dittman argued that keeping the money for reserves would save taxpayers money if an emergency expenditure is needed.  "If that happens we have to go out and borrow the money and pay interest, and taxpayers have to pay for the money that we borrow plus the interest," he said.  "They end up paying more than they do if we have the reserve, and the reserve earns interest for us, no matter how small."

But BOE member Richard Thaler was against taking the money.  "Right now people are suffering with the economy," he said.  "If you keep the tax rate where it is you are going to pay the penalty.  You've got to understand that this is the year that you have got to give the people that are paying the taxes the break."

Thaler added that the prospects of adding more properties to the tax roles are high in Lansing because it it the growth community in Tompkins County.  "Next year Lansing is probably in the best position of any town in Tompkins County as far as construction is concerned," he said.  "There are at least twelve new buildings being built at the present time that are not on the assessment roles."

BOE member Sandi Dhimitri spoke in favor of building up the reserves.  "I hear concern about fiscal responsibility," she said.  "You run a 22 million dollar operation that has almost no reserves.  That doesn't feel fiscally responsible.  I wouldn't run my home without some savings to cover disasters.  This is a chance to put some money aside to recreate that reserve."

Glenn Swanson expressed concerns about the failing infrastructure , and Michael Cheatham worried about unforeseen expenses such as the influx of special needs students the district experienced last year.

With Thaler and Cobb clearly against the higher tax rate, and Dhimitri, Dittman, Swanson, and Cheatham favoring it, board President Anne Drake proposed a middle ground.  "You both argue great points, and I totally agree with both of you," she said.  "I am choosing the middle one.  I think that helps build the reserves, but also gives the taxpayers a little bit of a break."

Superintendent Stephen Grimm says that when the value of assessed property has risen in the past Lansing school boards  have left the tax rate as-is.  He says it wasn't a problem in times of economic prosperity.  But he notes that this is not one of those times.  "I am very concerned that we don't just take money without it being an open process," Grimm said.  "It shouldn't be something that is slid in as a five minute resolution and people find out and say, 'How come we didn't know about this?'  We don't want that to happen."

But that is exactly what happened because of the deadline for approving the tax levy.  The board voted unanimously to split the difference, setting the tax rate at $17.76 to produce $14,894,065.  The district will get an extra $165,000.

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