School Impact of Plant Closing Argued

Aug022013

School Impact of Plant Closing Argued

 

aescayuga_plant120If the Cayuga Power Plant closes the impact on the Lansing school system will be devastating.  School officials have said that they have cut so much already that programs and teachers would be on the chopping block if still more revenue is lost.  At a New York State Public Service Commission hearing Monday Tompkins County Legislator Carol Chock and Ulysses Town Supervisor Elizabeth Thomas advocated closing the plant, arguing that the Lansing district should be able to fund its programs like neighboring districts do that do not have such a large taxpayer within their borders.

"I know it's tough," Chock said.  "But our other towns fund roads, teachers and football teams within their budgets without having a plant in their town.  If you tell the Lansing football players that they won't have a team when they're smart enough to know that the teams that they play don't have power plants there." 

Chock and Thomas advocated renewable energy, saying that if the only two choices are to repower the plant or upgrade the power delivery grid as NYSEG has proposed, the latter choice would be best despite the consequences to Lansing.

"If fear of increased taxes is driving the decision to repower with natural gas, let's look at a comparison of neighboring school districts," Thomas said.  "Both the Lansing and Trumansburg school districts are nearly the same size.  Each spends approximately the same per student.  The 2012 tax rates are also comparable.  However Lansing School District has not only a power plant, but also a large salt mine and high value lake shore properties which Trumansburg has none of."

But Lansing School Administrator Mary June King said that Chock and Thomas are comparing apples to oranges.  She noted that Lansing uniquely gets most of its revenue from taxpayers, unlike other neighboring districts that receive more state aid.

"The Lansing School District uniquely only receives about 25% to 20% of its revenues from state aid," King said.  "All of the other school districts in the area receive about 20% to 25% of their revenue from their tax base.  So we are the reverse of those.  So when you say that dime for dime or penny for penny or tree for tree we are the same as the other school districts... we are not.  We face a very unique problem when we face a significant impact to our taxable property base."

The PSC is considering proposals to repower the coal-powered plant with gas by Upstate New York Power Producers (UNYPP), which owns the Cayuga Power Plant, and NYSEG's proposal to close the plant and instead upgrade the power delivery grid.  Both options would be paid for by ratepayers, though UNYPP's Chief Operating Officer Jerry Goodenough says that his company's least expensive proposal would cost ratepayer nothing and actually return money that should reduce electricity rates.

King said that even if the plant were to close in 2017 the impact to Lansing taxpayers is here now because of the negotiated reduction in the plant's value that has been coming down since the last version of the PILOT (Payment In Lieu Of Taxes) agreement was renegotiated with the Tompkins County Industrial Development Agency in 2012.  That version phased in a decrease of the plant’s taxable value from $112.5 million to $60 million in three steps—to $86,250,000 in 2012, $74 million in 2013, and $60 million in 2014.

"Our net reduction to date from the power plat's PILOT agreement with the county has been the sum of $82 million in reduced taxable value," King said.  "That equates to about $1.3 million in revenues over the course of the past few years. We expect to lose a 14 million dollar revenue tax base next year from the power plant's PILOT agreement.  That would equate at this year's tax rate to about $290,000 in loss.  We expect to, possibly, depending on your decision, potentially lose another 60 million dollars in the assessed value in the next few years if you go with the NYSEG proposal.  That would be an annual loss of about one and a quarter million dollars."

King and Lansing School Superintendent Chris Pettograsso also enumerated a long list of energy saving measures the district has implemented over the past half dozen years.

"We've been really agressive over the last few years in pursuing energy savings opportunities," King said.  "We have engaged in an energy performance contract that has retired about 790,000 kilowatt hours of electric use.  In the same project we have managed to save 70,000 therms of natural gas."

King reported that the school district has saved over $200,000 annually by reorganizing the routing system of our transportation fleet.  The district has also made cuts in extra-curricular and athletic activities, and notably to academic programs.

The district has eliminated a number of positions from the Buildings and Grounds department, reducing it to a 'skeleton staff'.  Administrative offices have been reduced.  About 40 teacher and instructional support staff positions have been dropped over the past four or so years.

"Our budget increases since 2006-2007 -- and that's our actual expenditure numbers -- has averaged less than two percent each year," King said.  "That's a huge record that we can be very proud of, because we all know the consumer price index has been increasing more rapidly.  We all know that school districts have been brutalized by the Employee Retirement System and the Teacher Retirement System mandating increases in payments to those systems in record amounts."

King said increases in the TRS and ERS systems are typically greater than forty percent.  

"One year forty-eight percent," she said.  "That's ridiculous.  Our health insurance costs have been going up, just like everywhere else in the country.  I can probably say our health consortium is responsible enough that it's kept our health insurance cost increases somewhat lower than we've seen is an industry average.  We've capped it at about five and a half percent over the last six years, which is, I think, a remarkable feat."

King says that illegal state aid reductions have penalized the Lansing district by in excess of a million-three over the last several years at the same time the school district has been losing revenue from the Cayuga Power Plant and the PILOT.

New York State Senator Michael Nozzolio said the local property tax impact would be unbearable if the plant closes.

"The Cayuga Power Plant is the single largest taxpayer in the Town of Lansing, and if the plans to repower the Cayuga Plant are not approved, the average Lansing taxpayer would see their school taxes immediately skyrocket," he said.  "They would increase by 11.7%; and Town taxes would increase by 7,4%.  The plant's closure would cost the average property taxpayer in Lansing a hike of at least $600 each year, and make Lansing the highest taxed non-city school district in Tompkins County."

But King said it is likely to be much more.

"That doesn't take into account increased mandated costs that we've been seeing from the State," she said.  "It doesn't take into account what I would call an illegal reduction in state aid that we have experienced.  So I think that that is a very generous number that he put out there.  If we lose the Cayuga Power Plant the impact on the taxpayer is going to be far more significant.

"This year our tax rate is going up to $20.69, still not the highest in the county.  We're number four in the county.  But if you were to eliminate the Cayuga Power Plant tax revenue that we receive from the PILOT our tax rate would have to increase to about $22.64 per $1000.  That would be a 14% increase in our tax rate."

So far the net reduction from the power plat's PILOT agreement with the county has been $82 million in reduced taxable value.  That equates to about $1.3 million in school revenues over the course of the past few years. The district expects to lose an additional $14 million from the tax base next year.  At this year's tax rate that would be about $290,000 in additional revenue loss.

King said that while a number of speakers at Mondday's hearing advocated transition aid to the Lansing community if the power plant closes, King was skeptical that the school or township would see it.

"There has been some RGGI (Regional Greenhouse Gas Initiative) transition monies being available in the summer of 2013," she said.  "It is the summer of 2013.  We're half way through it this week, pretty much.  I still have the state Comptrollers coming into my office tomorrow morning and I haven't heard anyone say that RGGI transition money is available for the taxpayers of this district."

She said that school officials expect the district will potentially lose another $60 million in the assessed value in the next few years if the PSC chooses NYSEG's proposal and closes the plant.  She said that would mean an additional annual loss of about one and a quarter million dollars.

Pettograsso has been leading a movement to advocate for the district, including travelling to Albany and a letter writing campaign.  She says the district has been fiscally responsible, but the double whammy of state reductions and closing the power plant would force the district to raise class sizes and cut programs.

"I'm here and my children go to school here because of all that we offer," she said.  "I fear that our current residents who suffer these tax increases to be part of the Lansing school community and those who are trying so hard to get into the Lansing school community will go away."

v9i28

Follow us on Facebook!Click Here for Our RSS News FeedsClick Here for Our RSS News Feedsemailicon34
Don't Miss an Issue!
Get a reminder every Friday when a new issue of the Lansing Star is published.
Your Email Address:

We're Family Rated


ssurf.gifssurf.gif

Lansing Trivia

The Town of Lansing formed in 1817 when Tompkins County was formed

Advertise in the Star