Homeowners unhappy with hefty school tax increase following settlement with local business

WATERFORD, N.Y. (NEWS10) — Some homeowners in the Waterford-Halfmoon Union Free School District told NEWS10 ABC they were taken by surprise after opening their school tax bill this month. Laura Glaude said her bill went up by $700 in one year.

“Do I have to get a second job to pay for my taxes? I’m not really cool with that,” said Glaude.

Back in June, the school district approved a budget that would present about a three percent tax hike for homeowners. Glaude said, however, when she opened her bill, to her surprise, the percentage was closer to 27 percent. Her taxes from last year were $1,852, and this year, the bill was $2,549.

“Which is a $700 increase in one year,” said Glaude.

Waterford Town Supervisor Jack Lawler said Momentive, the silicone plant in town, filed a lawsuit against the town a few years ago. A spokesperson for Momentive said the facility was being appraised two to three times higher than it should have been. In mid-August, they reached a settlement where the taxable portion of the facility has been valued at $95 million compared to the $200 million it appraised for in years past. That reduction means Momentive is now paying less in taxes and homeowners must help make up for the loss.

“It was a very bitter lawsuit with very bitter negotiations,” said Lawler.

Glaude said a newsletter was sent out by the school district in August that gave just one month’s notice. Some homeowners, like Les Cloutier, said he never even received that letter. 

“It kind of blew us out of the water and screwed up our budget,” said Cloutier.

Superintendent of Waterford-Halfmoon Union Free School District, Patrick Pomerville, said the district made many attempts to notify taxpayers of the lawsuit. He also released the following statement:

“Let me begin by saying that the Waterford-Halfmoon UFSD understands the strain this tax rate increase placed on our taxpayers. Knowing the strain it would cause, we partnered with the Town of Waterford to fight the Momentive tax certiorari case and have been in litigation with Momentive for over two years. During that time, the District and Town fought very hard to ensure 1) Momentive’s assessed value remained as high as possible and 2) the refund of back taxes due to Momentive remained as low as possible. While we realize the ultimate settlement of this case resulted in a significant reduction in assessed value for Momentive, we would like to note that the reduction could have been far worse. Additionally, we were able to settle with Momentive on a refund amount for back taxes due that was far less than what Momentive was seeking. Additionally, the refund due will be nearly entirely funded by the District’s tax certiorari reserve which allows us to avoid any further tax impact to our taxpayers.

One large misconception that we have been hearing from our community is that the increase in taxes is caused by the District collecting more tax revenue. This is not the case. In fact, the significant increase in the tax rate is directly attributable to the reduction in Momentive’s assessment. The amount of tax levied by the Waterford-Halfmoon UFSD was the amount proposed in the District’s budget this spring. This amount remains within the NYS tax levy limit (tax cap). Unfortunately, when a business receives an assessment reduction this significant, the tax levy is distributed among the remaining assessed value in the taxing jurisdiction which causes the tax rate to increase.

I want to emphasize that while this may have seemed to be short notice to our taxpayers, the District has made many attempts to notify our taxpayers of the impending tax certiorari case. Over the last several years, I have updated the Board of Education in open session, on any and all progress with the case. Also, there have been several District publications over the last several years which spoke to the status of the case as well as the potential tax impact.

Again, we understand the burden this may have placed on our taxpayers and feel for our community but truly have done all we can do to minimize the impact.”

Both Glaude and Cloutier said they now fear what will happen with property taxes come January, but Lawler said they’re making every effort to offset that cost.

“We’re very confident that we can whether this storm with a maximum 5% tax increase,” said Lawler.

Lawler said the settlement prohibits any further assessment challenges by Momentive for a period of five years.

A spokesperson from Momentive provided the following statement:

“Over the course of several years, numerous factors including revised property assessments on Momentive’s facility in Waterford resulted in the company significantly overpaying local taxes.  Subsequent independent appraisals conducted by both the company and the town substantiated that the property assessment was presently two to three times higher than those appraised values, resulting in a substantial refund being owed to Momentive.

Momentive greatly appreciates our work with local officials to reach a reasonable compromise in fairness to everyone. Rather than continuing with litigation, and notwithstanding that Momentive is also facing challenges due to the economic impacts of the Covid-19 pandemic, the company agreed to forgive approximately 50 percent – or almost $5 million – of the refund it was rightfully due at the adjusted value, agreed to local proposals regarding the process and timing for receiving the reduced refund, and agreed going forward on a new assessment value that is still markedly higher than its expert’s appraisal.

We believe this compromise demonstrates our commitment to a reasonable and fair solution for everyone, as well as to our long-term commitment to the community.”

Lawler also posted the following message to the town’s website:

“After lengthy negotiations and extensive legal action which included our retaining the services of a nationally recognized commercial appraisal firm, the Town of Waterford and the Waterford-Halfmoon School District have agreed to settle the assessment lawsuit.

In their lawsuit, Momentive had demanded that the property’s taxable assessed value be reduced from $195 million to $54 million. They also demanded a total refund in excess $12 million from the School District, Town of Waterford and Saratoga County for overpayment of taxes from 2016 – 2019.

The settlement establishes a taxable assessed value of $95 million and a total refund of $5 million to Momentive. The refund will consist of an approximate $3.5 million from the School District, approximately $1 million from the Town, and $500,000 from Saratoga County. The settlement prohibits any further assessment challenges by Momentive for a period of 5 years.

The $1 million Town refund and the ensuing loss of future tax revenues as a result of the reduction in the assessment is expected to negatively impact the Town’s 2021 operating budget. The Town Board will make every effort to offset this by reducing operating expenses and utilizing surplus funds to minimize the impact on Town taxpayers.  

The final settlement reduced the potential tax refund liability by more than 50% and prevents Momentive from bringing future assessment challenges for five years. Given the potential for a much larger refund and an even greater reduction in the taxable assessed value, we are confident this settlement is in the best interest of our tax payers.”

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