OSWEGO, NY – At its meeting Tuesday night, the Oswego City School District Board of Education adopted a resolution approving the stipulation of settlement and order settling all of the pending tax certiorari proceedings with Oswego Harbor, LLC, for tax years 2006-2007 through 3022-2012.
The resolution passed unanimously.
In the litigation, Oswego Harbor (NRG) had asserted that the tax assessment value of the power plant property was too high for all of the years pending.
Prior to agreeing to the terms of the settlement, the city and the school district hired an appraiser to advise them on the valuation of the plant property for each of the tax years pending.
After consultation with the appraiser, the city officials and school district officials agreed to end all of the legal challenges, to avoid future legal and appraisal expenses and to eliminate the potential tax refunds and interest for all years in litigation.
The terms of the settlement provided that the assessed value will be reduced from $128 million to $70 million for tax years 2011-2012, 2012-2013 and 2013-2014.
The assessment for all previous years will remain unchanged.
The impact of this settlement on the school district will be a loss of approximately $1 million of tax revenue during the 2012-2013 school year.
The school district, through its prudent financial planning, will absorb this impact through the use of its tax certiorari reserve fund, district officials said.
Their first payment ($687,807) is due by Oct. 31, according to James Southard, the district’s interim business manager. It will likely be made Wednesday, he added.
The second payment is due on or before Feb. 28, 2013.
“It’s a stable rate for this year and next year, 12-13 and then 13-14,” he explained. “And then, 14-15, it fluctuates.”
The certiorari goes back to 2006-2007, he noted.
“What this stipulation provides us is essentially forgiveness of any funds that would be required for 2006-07 through the 2011-12 year,” he said.
According to the agreement, “The agreed upon reduction in assessed value shall not constitute an admission by any of the parties that this assessed value is the true full market value of the property; rather, the agreed upon reduced assessment was derived by the parties for settlement purposes only.”
“We’re glad that this is concluded at this point,” Superintendent Bill Crist said. “It seems to be the best resolution of a very difficult and involved and drawn out process.”