This article was originally published in Kaleidoscope‘s May 2026 print edition. It is also being published online for easy access.
On April 15, the Three Village Central School District Board of Education formally adopted a budget proposal of $245 million for the 2026-2027 academic year, sending it to voters for final approval on May 19. To cover the necessary costs, the tax levy was raised 4.54% to $187 million, matching the maximum set by the state-mandated tax cap. Few overall changes were made from the 2025-2026 budget, but rising external costs such as healthcare and other employee benefits forced cuts to certain areas.
Even so, these cuts are smaller than those implemented in last year’s budget, largely due to the unusually high tax cap, the calculation of which relies on several variables. First is the levy growth factor, which is equal to the rate of inflation but is limited to 2%. Therefore, although inflation decreased from 2.95% to 2.63%, this did not affect the tax cap. In fact, the smaller difference between the rate of inflation and the 2% levy growth factor made it easier for the district to combat price pressures.
The most influential component in the tax cap increase is the tax-based growth factor, which is determined by the amount of new construction within the district’s boundaries. Deputy Superintendent Jeffrey Carlson explained, saying, “Most of the time, it’s maybe 0.1% or 0.2%. That’s what we’ve seen lately. This year, it’s 1.19%.”
Finally, the cap was further raised by an additional $1.5 million earmarked for capital projects, which, along with repayments for earlier bonds, “are known as exclusions from the tax cap,” Carlson said. Essentially, these costs are not restricted by the state, so additions to them have the effect of raising the tax cap.
The district has justified the doubling of capital funds by pointing to the failure of the bond vote in January, with Carlson stating, “For some of our buildings, we need to get the work done: the roof’s not going to fix itself. The bond failed. So OK, and that’s fine, but we still need to do the work.” Specifically, the funds will go towards repairing the deteriorating cupolas of Setauket and Minnesauke Elementary Schools and R.C. Murphy Middle School, fixing remaining flood damage in Nassakeag Elementary School, and improving the safety and functionality of the Ward Melville High School swimming pool.
Despite the high tax cap allowing for greater flexibility, there was some difficulty in absorbing rising costs. Healthcare benefits increased by 12%, or more than $4.5 million, since last year, a trend driven by spiking pharmaceutical costs. In an attempt to offset some of the larger expenses, the district has made some slight changes to its policy, including by reducing copay coverage for GLP-1 weight loss drugs.
Throughout the budget drafting process, several administrators also raised concerns about the size of the fund balance, which Carlson described as a “rainy day fund.” During the COVID-19 pandemic, the account was significantly depleted, and withdrawals to fix a collapsing roof in Setauket Elementary further compounded the issue. As a result, the fund balance, which contained $24.9 million in June 2019, decreased by 60% to $10.1 million by 2025.
Despite allocating money to begin rebuilding the reserves, Carlson clarified that this spending will be limited: “There’s a school of thought among my counterparts in other districts that the more there is in fund balance, the better. But if I told taxpayers here that we had $100 million just sitting in the back, they’d think, ‘Wait a second, you’re taxing me a lot more than you need to.’ And that’s a valid point.”
A further issue was the small amount of state aid. Legislators in Albany have not yet finalized their budget despite an April 1 deadline, but the governor’s proposal only includes a 1% aid increase, or approximately $300,000. Carlson expressed some optimism that this would be revised to 2% by the legislature before passage, but administrators and the Board of Education could not assume this when crafting their proposal.
This continues a long-term decrease in aid for Three Village. In the 2009-2010 academic year, the state provided nearly 20% of revenue; this has now decreased to just over 15%, representing a difference of approximately $9 million. Given the community’s general affluence, this alone is not a major issue. However, when combined with the state’s restriction on taxation, it places pressure on the district and similarly well-off areas.
“There’s wealth in Three Village, but we can’t tap into it because of the tax cap. So we’re limited as to that,” Carlson explained, quickly clarifying that he didn’t “mean that as a criticism of the tax cap.” In other words, districts used to remedy shortfalls in state aid by increasing taxes slightly more; since the implementation of the tax cap in 2011, they have been unable to do this.
Carlson also noted the challenges brought by high rates of inflation over the last several years, and in particular the difference between those rates and the levy growth factor (which is capped at 2%). If the 2% ceiling did not exist, the district would have $26.5 million in additional revenue for the current budget proposal alone.
To contend with this changing fiscal landscape, Three Village administrators have begun to shift the ways in which they allocate funds. Carlson said, “My counterpart in the Half Hollow Hills School District, in her budget presentation, wrote ‘Start Saying No.’ That’s what we’ve had to start doing here too.”
It is not just non-essential furniture and technology replacements that are being eliminated. In fact, Carlson suggested that even requests for additional aids in classrooms are unlikely to be granted. (He made a clear exception for one-on-one assistance.) However, perhaps the hardest-hit category is that of co-curricular activities. Last year, approximately $1 million was earmarked for after-school clubs; in the current proposal, this figure is just over $800,000, representing a 20% cut on top of previous reductions.
District administration maintains that extracurriculars remain a priority, with Carlson saying, “We want to provide as much opportunity for the students as possible with those clubs.” Nevertheless, he acknowledged the shortfall and suggested that smaller student groups find ways to merge. Another cost-saving measure would be to reduce unnecessary field trips, although Carlson did not specify how this standard would be evaluated.
Further cuts were seen in administration. The roles of Executive Director of Personnel and Assistant Director of Instructional Technology were eliminated, which, together with a streamlining of department chairs across the three secondary schools, has led to a total reduction of nine administrative positions. The district also curtailed spending on various contracted services, supplies, and equipment by 25%.
However, the largest savings came from a large wave of retirements. “We’re seeing 21 teacher retirements this year; 10 years ago we might have had two or three a year,” Carlson explained. Perhaps more important is the fact that 18 of the retirees will not need to be replaced, a consequence of significant declines in enrollment over the last two decades.
When compared with the 2025-2026 budget, this proposal is perhaps notable in what it does not contain: a major change. Last April, board members approved a plan for a district-wide restructuring while, after vigorous debate, blocking a proposed change to school start times in a 4-3 vote. This year, the restructuring is essentially complete. And there was no discussion of start time changes or a contentious proposal to provide security guards with firearms.
There is also an additional proposition on the ballot this year to raise funds for the Long Island Museum. However, district officials stressed that this is entirely independent of the school district, and that the Board of Education did not even have the option of refusing to put the question to voters.
Despite the relative lack of controversial measures, opposition towards the budget is still expected, especially given the concerted effort to defeat the bond vote in January. (If the budget fails, spending will likely have to be reduced by $8.1 million, requiring steep cuts to certain areas.) In response, Carlson, together with Superintendent Kevin Scanlon, are hosting a series of public budget presentations to educate the community about the proposal and answer any questions voters may have.
If anyone is unable to attend these sessions, Carlson wants them to remember that the district “truly has the taxpayer in mind when we put the budget together. I know people don’t believe that, but we do.” He also reminded all residents of the district, “Vote what you think is best for you and your family. Not because somebody online told you, ‘Here’s how you should vote.’ But we want people to vote. This is the main thing. Please come out and vote.”
