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Argued May 3, 2005; decided June 9, 2005
Matter of Town of Riverhead v New York State Bd. of Real Prop. Servs., 7 AD3d 934, affirmed.
{**5 NY3d at 38} OPINION OF THE COURT
Graffeo, J.
We are asked in this case to determine whether a town that is part of a school district may contest the segment special equalization rate set by the State Board of Real Property Services for another municipality in the same school district. Based on our review of the relevant [*2]statutes, we conclude that the{**5 NY3d at 39} Town of Riverhead lacks capacity to bring this proceeding and therefore affirm the dismissal of the petition.
The levy and collection of school taxes for the support of public school districts is governed by the Real Property Tax Law. Where the boundaries of a school district are coterminous with a municipality, school authorities levy taxes based on the valuations of real property from the latest
assessment roll of that city or town (see RPTL 1302 [1]).[FN1] But most of the school districts in New York State include all or portions of several municipalities. Hence, these school districts collect taxes from municipalities or segments of municipalities that may have varying levels of assessments. To effectuate the fair allocation of taxes among these municipalities, the State Board
of Real Property Services is required annually to establish a state equalization rate for each municipality in the state (see RPTL 202 [1] [b]).[FN2] The state equalization rate is the ratio of the locally-determined assessed value of taxable real property within a municipality to the State Board's estimate of the true market value of that property (see RPTL 102 [19]; 1202 [1] [a]). In other words, the state equalization rate represents the percentage of true market value at which a municipality assesses its real property.
In order to apportion tax levies for a school district encompassing more than one municipality, the Real Property Tax Law directs a district superintendent to determine the full valuation of real property for each segment of the municipalities included in the school district by dividing the taxable assessed valuation of the real property in that part of the municipality by the state equalization rate established for the entire municipality (see RPTL 1314 [1] [a]). Where a municipality's state equalization rate does not accurately reflect the level of assessment within a particular segment of a school district (thereby resulting in a disproportionate tax burden), the [*3]State Board is authorized to calculate a special equalization rate for that segment (see RPTL 1226, 1314 [2]). The State Board may undertake such an adjustment{**5 NY3d at 40} only where there would "be at least a 10 percent change in the share of the levy of at least one segment of the taxing jurisdiction as the result of the use of the segment special equalization rate in place of the equalization rate which would otherwise be used for purposes of apportionment" (9 NYCRR 186

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