According to the New York State Assembly website, bill A10323-B "directs the Levittown Union Free School District to transfer up to $20 million from its reserve funds to the general fund for the purposes of reducing real property taxes in support of such school district."

Originally introduced in March by Assemblyman David McDonough in the Assembly and by Senator Kemp Hannon to the Senate (S-7314A), the bill passed in the Senate on May 12 and was referred to the Education Committee. The Assembly approval is still pending, however McDonough said he expects it to be on next week's Education Committee calendar.

Once the bill is passed by the Education Committee, it continues to the Ways and Means Committee and then the Rules Committee. The Rules Committee votes whether to send each bill to the Assembly floor.

"I'm pretty sure it will pass," McDonough said. "However, I don't guarantee anything."

The proposed bill states that up to $15,800,000 may be transferred from the employee benefit accrued liability reserve fund, and up to $4,200,000 may be transferred from the retirement reserve fund.

The $20,000,000 comes from an employee benefit reserve fund established years ago by the Levittown School District for accrued contract liabilities.

According to Levittown Superintendent Dr. Herman Sirois, upon retirement employees could previously get paid for unused sick days or a portion of them. This was what the employee benefit reserve fund was built for.

"Over the years that clause in all of the contracts has been negotiated out so that we don't pay our employees for unused sick days," Dr. Sirois added. "We are one of the few school districts that do not maintain this liability in our contracts anymore."

According to McDonough, the employee contract changed several years ago, eliminating the district's liability. The $20,000,000 in reserve funds was already established and the district sought to transfer that to the general fund.

The New York State Education Department approved the transfer, however the New York State Comptroller's office said that under state law, school districts can only transfer from a reserve fund to a reserve fund.

"If you want to transfer it to anything else it requires legislation," McDonough said.

The entire $20,000,000 is not transferred all at once. It is phased in over three to five years. The first year $7,000,000 is expected to be transferred.

"They [the school district] don't fund that reserve anymore," McDonough explained.

Newly elected school board member James Ward claims the school district is seeking such approval "to balance its books" by moving the money "from the district's reserve funds into the current budgets (2007/08) General Fund."

However Dr. Sirois said the special legislation requested by Levittown has nothing to do with balancing any current or future budget.

"The district is simply asking the state legislature for permission to give back to the taxpayers of the district certain funds, which had been accumulated over many years in specific reserve categories as authorized by the state," he added. "The special legislation is necessary for two reasons: first, because recent changes in the district's contract with its bargaining units no longer carry the liabilities for which these reserves were originally established; and second, state law does not allow the direct transfer of funds from reserves to the general fund. The money does, in fact, exist, and has been audited every year, as required by state law, by the district's external auditors."

For more information on the bill, visit www.senate.state.ny.us and click on Bills and Laws.