Forty-One Nassau County school districts have filed suit to challenge Nassau County Executive Edward Mangano’s move to end the so-called county guarantee, which obligates the county to make up for shortfalls resulting from successful challenges to property taxes.
The lawsuit, filed in Nassau County Supreme Court last week, follows the vote of the Nassau County Legislature in November to change the county charter. If the country guarantee was eliminated, school districts would effectively be responsible to cover back payments of multi-year tax certiorari settlements.
Herricks, East Williston, Sewanhaka and Great Neck are among the school districts that have joined with the Nassau-Suffolk School Boards Association in fighting the county’s attempt to put the onus of covering unpaid property taxes on the school districts.
The school districts’ liability would be approximately $52 million annually, according to Richard Hamburger, an attorney representing the school districts. Hamburger said the case hinges on whether the county has the right to rescind the guarantee.
“They’ve taken it on themselves to change the law. The legal issue is whether they have the authority to do that,” Hamburger said.
Mangano defended his decision to end the guarantee.
“For too long Nassau County has stood alone in the State, being the only County to collect 17 cents on the dollar in taxes, yet return the whole dollar when someone overpaid their taxes. This craziness has resulted in $1.6 billion in debt and outstanding liability while costing the average homeowner 10 percent more annually on their county tax bill,” said Mangano spokesman Brian Nevin.
Former county executive Thomas Suozzi previously tried to challenge the validity of the county guarantee in court on the basis of amendments to state statutes on collecting taxes. Under Suozzi’s administration in 2002, the county also had sought relief from its obligation by lobbying state legislators, who ultimately enabled an extended time frame for sorting out tax grievances, giving the county one year and 30 days to resolve them.
The guarantee was established when the state legislature enacted the Nassau County Administrative Code in 1948, empowering the county to make assessments, with the responsibility to make refunds. That code also shifted the responsibility to compensate for any deficiencies in tax collections from municipalities and villages to the county.
Notwithstanding the difference in issues in the current court case, Hamburger said he is confident about the outcome.
“I’m optimistic that the result will be the same,” Hamburger said.
He said he expected that he expected the case to be resolved by the summer, long before the lapse of the guarantee would have take effect in July 1, 2012.
The participation of 41 of the 56 school districts in Nassau County lends weight to the case, he said.
“It shows that there is a remarkable unity among school districts that there are 41 of 56 that have chosen to go to court,” Hamburger said
The school districts have come together through the Nassau County School Boards Association, which initiated the effort to bring the school districts into the lawsuit in a common cause.
“School boards have an obligation to bring this litigation” Nassau-Suffolk School Boards Association President Jay L.T. Breakstone said in a statement. “Having failed in New York’s court system, including a complete disregard of the repeated denials by New York’s Appellate Courts, the County of Nassau has decided to simply do what it wants to do anyway.”
Mangano maintains that ending the guarantee makes prudent economic sense for the county.
“For too long Nassau County has stood alone in the State, being the only County to collect 17 cents on the dollar in taxes, yet return the whole dollar when someone overpaid their taxes. This craziness has resulted in $1.6 billion in debt and outstanding liability while costing the average homeowner ten percent more annually on their County tax bill,” said Mangano spokesman Brian Nevin.
An initial hearing date of April 8 has been set in Nassau County Supreme Court, but Hamburger said he anticipated that the county would seek an extension.
