Discontinuation of the state’s School TAx Relief (STAR) Rebate has some residents worrying about how they will afford school taxes.

As local school districts cut expenses — including jobs and programs — to keep the tax levy in check, middle-class residents may still see an increase in their overall payments because they won’t receive a rebate next year.

“It’s quite possible, even though we are not increasing the tax levy, that taxpayers may see an increase in their taxes that’s not connected with the school,” said Helen Lounsbury, president of the Berne-Knox-Westerlo School Board. BKW decreased next year’s budget by more than half a million dollars to keep the tax levy increase at zero.

Jean Cataldo, receiver of taxes in Guilderland, stressed that it is the Middle Class STAR Rebate that is being cut, not the STAR exemptions.

According to Thomas Bergin, director of the state’s Department of Taxation and Finance, 94 percent of people in the state qualified for the middle-class rebate. Of the 94 percent, Bergin said, his department saw near unanimous application. Only 8 percent of people who owned homes either didn’t apply or didn’t qualify, he said. In 2008, said Bergin, the total amount of money sent out in rebate checks was over $3 million.

History

The STAR exemption was instituted in 1997. There are two forms:

— The Basic STAR, for any New York State resident who owns and lives in his home, which exempts $30,000 from a home’s assessed value; and

— The Enhanced STAR for those over 65, which exempts an additional amount.

These two exemptions will remain in place.

However, the Middle Class STAR Rebate program, which was enacted in 2006, providing additional benefits to taxpayers on a sliding scale based on income, is being discontinued, according to Bergin. He explained unfolding political events this way.

In 2006, under Governor George Pataki’s administration, the Middle Class STAR Rebate program began, and a rebate check was issued to anyone who had applied for the STAR exemption.

In 2007, under Governor Eliot Spitzer’s administration, the Middle Class STAR Rebate program was changed so that it was a sliding scale, based on income.

As originally envisioned, according to the state’s Division of Budget, upstate residents with incomes of $90,000 or less were to receive a 60 percent additional benefit in 2007-08, a 10 percent additional benefit in 2008-09, and a 10 percent additional benefit in 2009-10.

 A notification was sent in the mail to those using the STAR exemption; the notification included instructions on how to apply for the rebate check online.

Now, under Governor David Paterson’s administration, households that have received the rebate check in the last three years will not receive one this fall.

“It’s like apples and oranges,” said Bergin, in reference to the STAR exemption program and STAR rebate program. “In this case, you can’t have the orange without the apple, but you can have the apple without the orange. It’s the orange, or the STAR rebate program, that’s being taken away, and the apple, or the STAR exemption, that is being kept.”