KINGSTON – On April 1, Ulster County Comptroller Elliott Auerbach will sign over some $22 million to local school districts to cover uncollected property taxes during the 2009-10 school year, an amount that represents a 5.6 percent increase from last year and a 53 percent jump since 2006.

The county is obligated by law to reimburse the districts for all taxes that remain unpaid after March 31. In total, 15 districts will be compensated for uncollected taxes; four of 15 – New Paltz, Onteora, Rondout Valley and Saugerties – each require more than $2 million of county funding to make their budgets whole.

Historically, local school districts collect approximately 89 percent of their levied tax; the balance, according to NYS Real Property Tax Law, is the county's responsibility to bear. Curiously, the county does not budget for this obligation; the $349 million budget for 2010 does not include a line for unpaid school tax, an egregious oversight that Auerbach acknowledged as a problem.

He said he decided to conduct an audit when he realized that there was not a "budgeted component" to meet this obligation. "As I watched the numbers increase over the past few years I questioned how the county, obligated by law, was going to meet this unusually large drain on our budget," he said.

Auerbach said the NYS Commissioner of Finance suggests using the monies drawn from the county's cash flow to make the districts "whole," but that "an unusually large amount," like this year's $22 million, may force the county to borrow with "an anticipation note."

"School property tax is the largest of all property taxes and has placed a burden on many property owners throughout the county," said Auerbach.

While acknowledging that the county has no authority or voice in the school budget process, the comptroller said he believes that "the time has come, as we strive for excellence in education, to devise an alternate method of financing our public schools."

Ulster County legislator Robert Aiello (R-Saugerties) agrees that school funding is problematic. In a recent letter to the editor of Kingston's Daily Freeman, he wrote: "The property owner's inability to pay [school taxes] has been outpaced by continued spending in some districts."

"It's time to revisit the rules dictating one municipality to be held responsible for another's obligation. Delinquent taxes were generated at the school level. They should be met there," Aiello said.

Aiello takes issue with Auerbach's interpretation of the county's responsibility for unpaid school taxes, as written in the state's real property tax laws. He notes that Auerbach cites Section 1330 of the NYS Real Property Tax Law, which states that the county must pay the school districts "the amount of unpaid school taxes." However, Aiello contends that Section 972 of the law only states that the county "may become the collection agency" for unpaid school taxes. "The county is not required to serve in that capacity," he said.