School budget includes 2.1 cent tax increase

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UPPER TOWNSHIP – The school board Monday approved a $34,295,912 school district budget that would increase property taxes 2.1 cents.

 

The proposed budget may have to be altered depending on state aid figures that were expected to be released on Tuesday, Feb. 26.

School business administrator Laurie Ryan said the budget includes a $22,813,891 tax levy. Based on the same rateables as this year that would equate to a 1.032 tax rate, she said. 

That would mean an increase of 2.1 cents, or about $70.59 for an average property assessed at $336,100.

“Please remember that this is only an estimate and assumes the rateables from last year and the average assessed home,” Ryan said. 

The budget will be submitted to the Cape May County Executive Superintendent for review. A public hearing on the budget will be held in March.

There was no public comment on the spending plan Monday, but school board member Steve Martinelli asked why the school budget always went to the state-mandated two percent cap.

“Why do we always go to cap?” he asked. “I mean, we always go to the two percent, the maximum allowed. Why do you just plug that in? This is important. People think that’s what we do.”

Martinelli asked Ryan if there was any room to decrease the line items in the budget. He said he did not want the public impression to be that the board automatically spends as much as possible. 

“Every year that you don’t go to two percent, you lose it the following year,” said Ryan, adding that scrimping to bare bones can “come back and bite you” when needed maintenance of facilities and other needs are disregarded. “We used to have to ignore the facility needs.”

For many years, as the school population exploded, the district owed an increasing amount of tuition to match the growing number of students going to Ocean City High School, Ryan said. Meanwhile, facility needs were put on the back burner.

Ryan said she and Palmieri go through all of the requests by various department heads with a fine tooth comb and “cut things.”

“Certainly as a taxpayer I don’t want a two percent increase either, but we do have to put money in the classrooms,” Ryan said. 

Martinelli, who is chairman of the district’s building and grounds committee, said he would “love to have that money” for building maintenance, but he worried, in the wake of Hurricane Sandy, about Strathmere taxpayers. 

“I’m serious, I would love to have that money,” he said. “But they pay a lot of taxes.”

The budget assumes a five percent reduction in state aid from last year, Ryan said. If the reduction is more than five percent, she said the funding to replace the state aid could come from the fund balance, from $1.7 million budgeted for building maintenance or from cuts elsewhere.

The district’s fund balance, or surplus, was increased $342,000 this year.

The school board approved a resolution authorizing Ryan to reconfigure parts of the budget if necessary to take care of a shortfall.

“This year was the perfect storm,” Ryan said. “We didn’t get the tuition rates from Ocean City until very late and the state aid figures are still not in.”

She added that the five percent figure was “optimistic.”

The budgeting process was made a lot easier last week because of a tuition adjustment from the Ocean City school district to Upper Township to the tune of $1,032,106. (See related story). Ryan said the adjustment was due to fewer students than expected attending Ocean City High School, and the School Choice program in Ocean City. 

“To Ocean City’s credit, the School Choice program had a lot to do with it,” said Ryan. “That really helped reduce the per pupil cost.”

Ocean City’s tuition rate dropped from $15,999 for the 2012-13 school year to $15,256 for the 2013-14 school year. Upper Township will owe Ocean City $1.7 million less next year than it did this year.

Palmieri said the roughly 16 percent decrease was welcome, but not a windfall for Upper Township.

“Every year when we hear about Ocean City tuition, everyone has a different perception,” he said. “Please remember that money has yet to be able to cover the increase in salaries, utilities, professional services and insurance and whatever is left goes right to buildings and grounds.

“It’s not like Laurie gets $1.7 million above and beyond. It allows Laurie to pay expenses, that’s important for people to hear, important for people to remember,” he added.

Upper Township plans to send 649 students to Ocean City next year for a total of $9,901,144. Additional costs of $311,526 and $48,728 for disabled students are added to that figure. With the tuition adjustment the total is $9,229,292.

Ryan noted that special education costs had increased 77 percent as five eighth graders head to the high school at $34,614 each.

Two students will be educated elsewhere at a cost of $300,000, which includes transportation and education. One of the students may return to the district, he said.

“Every district has the challenge of meeting the educational and emotional needs of all students,” said Palmieri. “We do our best to educate all students in house, but every once in a while we can’t do that.”

Ryan said school officials are seeking ways to reduce transportation costs, which for one of the students totaled $92,000 for daily roundtrips to Haddonfield. Purchasing a bus could save money, she said.

The district will save money by hiring four additional part-time kindergarten aides to help in the classrooms rather than one additional full-time teacher.

“Because we do have a lot of kids in kindergarten,” said Ryan. 

The Affordable Care Act requires that anyone who works 30 hours or more a week must receive health insurance, Ryan said. The school district cannot afford to pay those costs, she said.

“They would be entitled to family benefits and we cannot afford that,” she said. “We cannot as a district afford to give all those people family benefits. It may require that we add more aides as time goes on but it will all come out in the wash. I want you to be aware because you will see more new hires for aides along the way.”

“We really need them,” said Palmieri.

Changes in the requirements of a substance assistance counselor need to be addressed as well, he said. The district may need to hire an additional staff member, but he was not sure if the new hire could be part-time or shared with another district, or must be full-time. 

“We’re waiting for an answer from the county,” he said. 

Health costs are expected to increase 15 percent this year, Ryan said. Last year the increase was 9.9 percent. 

“We had a good run while it lasted,” she said. “Unfortunately (we have) an increase.”

Ryan said the district experienced a lot of claims recently, leading to the increase. 

“We had a bad month,” she said. “I would love to be at 12 percent.”

Worker’s compensation insurance is flat, she said. Property insurance went up eight percent. 

Palmieri asked school board members to keep the increase in health insurance in perspective as many area districts are experiencing increases of as much as 25 percent.

 


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