While the Herricks School District recently joined several other North Shore school districts near the top of Newsweek’s 2013 rankings of the top high schools in the country, school officials say the lack of a commercial base has forced them to take a somewhat different route to academic excellence.
“It’s a very significant factor,” said Herricks Superintendent of Schools John Bierwirth. “The big difference after that is that the others have very big commercial bases. We don’t. The [Herricks] homeowner pays a substantial amount of the school budget because it’s not supported by a commercial base.”
Of the projected $92.24 million tax levy Herricks projected for the 2013-14 school district budget of $104.62 million, 93.38 percent will be paid by district residents, according to calculations presented by Helen Costigan, Herricks assistant superintendent of business at last week’s school board meeting.
That percentage hasn’t varied much over the past 12 years. Herricks homeowners were paying 89.93 percent of the tax levy in 2001, when the district had a 7.34 percent commercial tax base.
The commercial tax base in Herricks is currently 3.5 percent of the tax base, with the second largest category after commercial property now apartments and condominiums at 9.29 percent.
By contrast, the current tax base in the Great Neck School District is 84 percent residential and 16 percent commercial, according to John Powell, Great Neck assistant superintendent of business.
Of the projected $192.6 million Great Neck tax levy for the proposed 2013-14 school budget of $209 million, 65 percent will be paid by residents who own homes, with 35 paid by Great Neck’s commercial entities.
Powell said the percentages have been slowly shifting toward the residential side since a reassessment in 2000.
For the current year, the $186.8 million tax levy for the Great Neck School District was covered by $120.02 million from residents and $66.74 million by commercial property taxes and apartments and condominiums.
“What you’re seeing is a shifting of that value,” Powell said. “But it would take another 20 years for that to shift to 84 percent.”
In the Newsweek survey, Great Neck South High School ranked 67, Herricks 177, and Great Neck North took 181 while Manhasset was ranked 75, Wheatley 92 and New Hyde Park Memorial 256.
The data for the rankings are self-reported by schools, and Roslyn Public Schools did not apply for the ranking.
Average assessed house valuations also offer a contrast between Great Neck and Herricks. The average house assessment in Great Neck is $906,000, according to Powell. The average house assessment in Herricks at $521,000, according to Costigan.
The tax cap has changed the playing field somewhat this year.
Great Neck is facing $14 million in increased costs compared to 2012-2013, driven largely by a $4 million jump in retirement liabilities and $2.2 million in projected tax refunds, school administrators have said.
Herricks was forced to make significant budget cuts in the last two years under similar pressure while struggling to maintain its academic programs. Its school board was forced to eliminate 49 teaching positions in the past two years, and is planning to cut an additional 14 positions next year.
Now the Great Neck School District is facing the similar financial pressures from the tax cap and rising employee pension and health care costs. Great Neck’s proposed budget calls for the district to cut 41 positions – or their equivalent in hours – districtwide, according to Powell.
Powell said the reductions are equivalent to 17 teacher positions and 24 teachers’ aides, assistants and monitors.
“We’re confronting the same pressures that Herricks did now,” said Great Neck Superintendent of Schools Thomas Dolan. “We knew going in that we had to find $6 million. This is the largest number of cuts made in the district in a single year.”
Dolan said the Great Neck budget puts the district at the upper limit of the tax cap.
The Great Neck and Herricks budgets reflect a difference in the overall size of the two school districts: the student population in the Great Neck district is currently 6,375 while Herricks’ student population is currently 3,900. They also reflect a difference in cost per student.
The annual current cost per student in Great Neck is $31,377 compared to an annual current cost per student of $25,876 for Herricks, according to the state Department of Education.
The Great Neck district also encompasses two high schools and two middle schools to the Herricks district’s one high school and one middle school.
The differences in the economics has prompted a difference in financial strategies, with Great Neck able to maintain larger financial reserves while Herricks has stressed efficient spending with minimal reserves to fall back on.
“We’ve not had the money to build up significant reserves or carry a lot of cash in other ways,” Bierwirth said.
With the advent of the tax cap, Herricks has had no other choice but to cut back on staff, with salaries and benefits the biggest piece of any school district costs, school officials said.
“Class sizes are larger. There are fewer support staff. The cumulative impact has been fairly significant. On the other hand, we’re still here,” Bierwirth said. “We’ve not eliminated whole programs.”
Dolan said Great Neck has “nibbled around the edges of our programs” while finding ways to be “economically responsible.”
Both districts confront the problem of maintaining reserves to cover possible tax certiorari costs, despite a recent court ruling that upheld the county’s responsibility for covering property tax shortfalls for school districts. But the money involved is on a different scale, with Herricks maintaining a $350,000 reserve against tax shortfalls and Great Neck maintaining a $2.5 million reserve.
“We’re still in a very good reserve position. But as soon as you start to use reserves, it creates a hole,” Dolan said.
At last Thursday’s board meeting, Costigan said there was a 3.4 percent decrease in residential assessments this year. But she also said she received more calls from residents raising questions about their assessments than in any other year, due to apparent inconsistencies in the system.
She noted that a house on one street drew a 50 percent reduction in its assessments, which she said means that neighboring residences make up the difference in higher assessments.
“It’s really chaotic,” she said.
While Great Neck is about to endure significant staff cuts, they are not on the same scale Herricks is suffering. Long-term, Herricks remains at a clear disadvantage to a district like Great Neck with a solid commercial base that eases its problems in coping with the tax cap.
Ultimately, Bierwirth said the answer is to address pension and health care costs and the way New York funds its school districts.
“I think that how schools are funded in New York State is a problem,” he said. “As long as the funding formula stays the way it is, Herricks is going to keep operating the way it is.”
Dolan said he agreed that the current situation is untenable.
“It’s just not possible to limit how much we can raise and in the same breath send up big pension bills,” he said.
