Valley Stream school districts clash over tax-burden distribution

A joint-boards meeting among the Valley Stream schools on May 4 in the Valley Stream Memorial Junior High School cafeteria had more characteristics of a tense courtroom than of a typical Board of Education meeting, with lawyers offering interpretations of state education law, school officials clicking through slideshows about property taxes and occasional outbursts by residents.

Among the school systems taking part in the meeting was District 13, which comprises parts of Elmont, Franklin Square and Malverne.

The joint-boards meeting was scheduled in advance of the Hempstead Industrial Development Agency’s April 27 decision to revoke tax breaks granted to the Green Acres Mall, and had a specific agenda: to hear a proposal by District 24 officials and attorneys that they believe would return the proportional share of taxes between the school districts to what it was before the mall’s tax breaks.

District 24’s position is that it was unfairly taxed when the mall’s tax status changed, because of the way the Central High School District is funded — tax payments are collected from each elementary district based on its taxable property. With the mall’s switch to a payment-in-lieu-of-taxes agreement, or PILOT, it came off the county tax rolls, District 30’s payment to the Central High School District shrank, and that shortage was redistributed across District 13’s and District 24’s properties.

District 24’s lawyers, from the Melville-based firm Lamb & Barnosky, LLP, suggested that the high school district has more control over the tax-distribution process in the Valley Stream schools than it has exercised, pointing to the fact that the education law that governs central high school districts was written well before PILOTs were introduced by IDAs in the 1970s. District 24’s proposal recommended that the high school district consider PILOT revenue as tax revenue, which, in the case of Green Acres, would have prevented the high school district from taxing Districts 24 and 13 to make up for a decrease in taxable property in District 30.

After a 15-minute presentation by District 24, the room became silent.

“Are there any questions about what we’re proposing?” asked District 24 Board of Education Trustee Armando Hernandez. There was no response. School officials from each of the districts then met privately with their attorneys before returning and rejecting the proposal. Lawyers for Districts 13, 30 and the high school district — all from Farmingdale-based Guercio & Guercio, LLP — concluded that the proposal would be illegal, while District 24 officials continued to dispute that claim.

“It’s unfortunate when good lawyers disagree,” said Gregory Guercio, an attorney for the Central High School District.

Once it became clear that Districts 13, 30 and the central district did not support District 24’s proposal, John Maier, a District 24 trustee, read a statement saying that it would not make further payments to the central district based on its interpretation of state education law.

“District 24 agrees that we owe the high school district $18,128,153 for the 2016-17 school year, pursuant to our formula,” Maier said. “That final payment will be made on or about May 18, 2017. Therefore, we will not be making any additional payments, and instead [will be] placing money aside in escrow for the future.”

Maier was interrupted by applause from shouting attendees, whose cries grew increasingly louder. Bill Heidenreich, the Central High School District superintendent, said that he did not want to comment before discussing the issue with the Board of Education on Tuesday, after the Herald went to press.

District 30 Superintendent Nicholas Stirling said that the district’s main concern is making sure that the mall returns to the tax rolls. “Last week there was a victory for the community, but the victory is not complete,” Stirling said, referring to revocation of the tax breaks. “Part of the issue right now, in terms of advocacy that affects 30, 24 and 13, is that the mall needs to get back on the tax rolls. Period. If that doesn’t happen, I’m telling you, residents will be paying more once again.”