School districts have another budget stressor to add to the extra costs required by the Covid-19 pandemic: This year's property tax cap for schools is 1.23%, which is the second consecutive year it is below 2%.
The rate governs how much a school district can increase its tax levy. State Comptroller Thomas P. DiNapoli announced the rate Wednesday.
“School district and municipal officials must remain fiscally cautious to stay under the cap as they prepare their budgets,” DiNapoli said.
The tax cap, which first applied to local governments and school districts in 2012, limits annual tax levy increases to the lesser of the rate of inflation or 2%. Each of the nearly 700 school districts calculate their tax cap rates individually, with certain exclusions allowed. In some cases the allowable levy – or amount to be raised by taxes – will be over 2% because of the exclusions.
School budgets with a levy larger than that allowed under the tax cap must be approved by 60% of voters at the annual school district vote in May.