Submission Date:
Question:
Our library gets taxpayer funding from its own line on a school district tax bill. We know this "259" funding is a recurring tax that can only be changed with approval of the voters. That said, this year the total amount remitted by the school district was reduced due to "corrections" made after the tax bills went out. We've also been told the library could have to return levy money if a taxpayer successfully challenges their assessment. Is this true? We're concerned about what such reductions could do to our annual budget.
Answer:
The short answer is yes, it's true. A school district tax levy, even if it’s a separate line on a school district bill in support of a library, can be reduced if a taxpayer challenges their assessment after the tax bills go out, and yes, since 2022, a library may have to refund overpayments.
While taxes supported directly by the voters (and distinctly designated on tax bills as for the library) are the most stable sources of annual revenue, both can be subject to the correcting and refund provisions of New York's Real Property Tax Law (RPTL 554 and 729, respectively).
For this reason (and others), it’s a good idea for a library dependent on such revenues to maintain a fund balance that can help bridge any reductions.
All that said, if your library receives notice that a reduction or refund must be made due to correction, it is wise to ask for the details and underlying documentation (and have your lawyer or accountant review them), to ensure the board is in a position to agree that the reduction or refund was issued properly.
There are about fifty more pages I could write on this topic, but that's the Big Picture, and the Big Takeaways are: 1) it can happen; 2) it is good to prepare for it; and 3) if it happens, review the details before agreeing to it.
