New York’s Southampton Overpaid School Districts, Auditor Says

The New York town of Southampton, a summer hotspot for Wall Street investment bankers and Hollywood stars, overpaid more than $1.91 million in lieu of taxes to two Long Island school districts, Comptroller Thomas DiNapoli said.

Southampton gave $8.29 million to schools in the eastern end of Long Island, when the amount should have been $7.62 million, DiNapoli said today in a statement, citing an audit of payments made on tax-exempt property by the seaside town. He said it underpaid a third system and three fire districts.

“When governments and municipalities make mistakes, taxpayers suffer,” DiNapoli said. The error stemmed from a misinterpretation of a 2007 change in the law under which towns make payments in lieu of taxes, DiNapoli said.

The town of about 55,200, frequented by billionaire investor George Soros and movie stars Renee Zellweger and Michael J. Fox, could have saved about $664,600 over the two years that were examined, according to DiNapoli’s audit. The biggest overpayment, of $1.76 million, went to the Riverhead Central School District, DiNapoli said.

In its official response, the town said it would develop a “corrective action plan.” Southampton officials couldn’t be reached immediately today for comment.

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