School Board Institutes 3% Utility Tax

Beginning September 1, Rye residents will see an additional tax on their utility bills.

Published June 7, 2014 5:00 AM
2 min read

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Beginning September 1, Rye residents will see an additional tax on their utility bills.

 

By Sarah Varney

 

Beginning September 1, Rye residents will see an additional tax on their utility bills. After listening to the views of a handful of members of the public at its May 28 special meeting, the Board of Education members voted 6-1 in favor of implementing a 3% utility tax. The District hopes to reap $900,000 over ten months, which will go toward the 2014-15 budget. (Currently, the City of Rye collects a 1% utility tax that yields approximately $400,000 annually.)  

 

Before the vote, one resident expressed some confusion over whether the May 20 School Budget vote included the utility tax. Former Board president Jim Culyer said, “I support the utility tax but I don’t support the way it was presented. What you’ve heard tonight is that there wasn’t enough information presented to the public because if there had been there would be more than six people in the audience,” he said.

 

Former Board president Steve Feeney spoke of the necessity of the tax and the fact that many school districts already have a utility tax in place to help fund their budgets. “Of the six small city school districts in Westchester, five have had the utility tax for 20 years or longer,” he noted.

 

“Just because everyone else is doing it, does that mean we should?” asked former Board member Bob Zahm. He and outgoing Board member Ed Fox both emphasized the fact that the utility tax is not deductible, while property taxes are. “We ought to approve the deductible tax, not the one that’s not deductible,” said Fox. “It’s not appropriate to pick the tax that’s an expense for the taxpayer.”

Zahm chastised the Board for not providing enough information on how the utility tax will affect individual homeowners. (It’s a regressive tax, which is harder on lower income families.) He estimates that most property tax payers will receive a “tax freeze rebate” check in November that will be less than the added cost of the utility tax. Under the state budget just passed, homeowners with incomes under $500,000 will receive rebate checks for some percentage of their property taxes. Under the arrangement, both the city and local school district must have tax cap-compliant budgets in order for homeowners to qualify for the rebate.

 

In a statement made via email, Board President Laura Slack justified the decision: “The Board decided to implement a utility tax in order to diversify the revenue stream and find another way to stay within the tax cap.”

 

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