The Riverhead School District tax rate will jump by 7.7 percent next year for property owners in the Southampton Town portion of the district, which includes Flanders, Riverside, Northampton and Red Creek, despite the fact that the districtwide school tax levy increased by 3.8 percent, according to Southampton Town Tax Receiver Theresa Kiernan, who discussed the issue at last Thursday’s Southampton Town Board work session.
The school tax rate has seen some large swings between the Riverhead and Southampton towns in recent years, Between 2008 and 2010, the Southampton side saw increases of 22, 14 and 14 percent. During the same period, the rate on the Riverhead side went down one year and increased by 1 percent and 2 percent in the other two years.
Riverhead Town comprises about 81 percent of the school district, Southampton Town 17 percent and Brookhaven Town 2 percent.
The areas hit by these increases also are considered low-income areas by the U.S. census.
The school district sets the overall tax levy, but has no say in how that money is divvied up among the three towns. The school tax increase in any one of the towns also is not governed by the state’s 2 percent tax cap, officials said.
In the 2013 tax bills, which went out last December, and the 2013 tax rates, the increases on both sides of the district were similar.
For 2014, the overall school district tax levy — the total amount of taxes collected from district property owners in Riverhead, Southampton and Brookhaven — will increase by 3.8 percent. The Southampton Town segment will see an increase of 5.4 percent, while the increase for the Riverhead Town portion will rise by 3.6 percent. Residents living in Brookhaven piece of the Riverhead School District will get a tax levy increase of 3.1 percent.
Ms. Kiernan said Southampton has computed a final tax rate for property owners in the Riverhead school district of $14.13 per $1,000 of assessed value, up from the current rate of $13.11 per $1.000. For someone with property assessed at $200,000 in the Southampton Town part of the district, that equates to $204 more in school taxes next year.
“Somehow, the burden shifts onto us,” she said.
Riverhead Town has not formally set the school tax rates in its part of the district, but it is expected to be up by about 3.3 percent, according to town finance administrator Bill Rothaar.
The tax shift toward the Southampton side of the district comes despite the fact that Southampton Town is applying $1.9 million in Community Preservation Fund payments in lieu of taxes, or PILOT payments, to the school district, which qualified for that aid because a large percent of the district in Southampton is off the tax rolls as preserved open space and parkland.
Southampton applied $1.7 million in CPF PILOT money in 2013, Ms. Kiernan said.
“If it wasn’t for the CPF, the increase would be off the charts,” Ms. Kiernan said in an interview.
The land values in this part of the town have gone down this year, which is why the tax rate increase is more than the tax levy increase, Ms. Kiernan said.
Some residents in the Southampton Town portion of the district may not end up paying more in taxes if their assessed value decreased to the point where the higher tax rate was offset, officials said.
The school district tax levy is divvied up between the three towns based on the assessed value of each portion of the district, as determined by the state equalization rate, which attempts to measure at what percentage of market value a town assesses property.
Southampton Town, which reassesses its properties annually, has an equalization rate of 100 percent, which means the state feels the town’s assessments are at market value.
Riverhead Town, on the other hand, has not done a reassessment since 1980, so its equalization rate is at 15.98 percent. Brookhaven Town’s equalization rate is 0.95 percent.
During last week’s work session, one Southampton Town Board member questioned last week whether annual reassessment was worth the effort.
“Riverhead still doesn’t do the 100 percent assessments,” Southampton Councilwoman Bridget Fleming said. “We keep being told that because we’re doing 100 percent, we are going to be treated fairly, but we see, year after year, that the folks who are not doing the 100 percent are not carrying the same burden as we are.”
“I’m not sure you can make that blanket statement,” Southampton Supervisor Anna Throne-Holst responded.
She said overall property values in Southampton are higher than in Riverhead, which affects the equalization rate, and thus the tax rates shift.