2013-04-04 / Schools
SRHS $15.7M budget calls for flat tax levy
School taxes decrease for three of four sending towns
Three of the four sending districts that comprise the Shore Regional High School District — Oceanport, Monmouth Beach and West Long Branch — will pay less in taxes for the 2013-14 school year.
Taxes will increase, however, for property owners in Sea Bright, which will pay a higher percentage of the regional school budget.
The Shore Regional High School District Board of Education has introduced a $15.7 million budget that includes a $14.6 million tax levy, which remains flat from last year.
“The only number that I produce is our tax levy, which is zero [percent increase],” district Business Administrator Dennis Kotch said during the March 28 public hearing on the budget.
“How that tax levy gets allocated is out of our control; this percentage [each sending town pays] comes from the state funding formula and the total ratables comes from the county,” he said. “The percentages come from the [state] Department of Education — based on the state funding formula, based on enrollment and different factors.”
The Board of Education could not adopt the budget, which is down $182,000 from last year’s $15.9 million spending plan, due to lack of a quorum.
Under the state funding formula, West Long Branch taxpayers will pay 32.3 percent of the tax levy; taxpayers in Monmouth Beach will pay 25.1 percent; Oceanport will pay 26.8 percent; and Sea Bright will pay 15.8 percent.
If the budget is adopted, the owner of the average Sea Bright property, assessed at $344,696, would pay a tax rate of 54 cents per $100 of assessed valuation, representing a 13-cent increase over last year.
The owner of an Oceanport home assessed at the borough average of $450,000 would pay a tax rate of 40 cents per $100 of assessed valuation, representing a 1.9-cent decrease over last year.
The owner of a Monmouth Beach home assessed at the borough average of $583,553 would pay a tax rate of 31.7 cents per $100 of assessed valuation, representing a 0.8-cent increase.
The owner of a West Long Branch property assessed at the borough average of $383,000 would see a tax rate of 43.6 cents per $100 of assessed valuation, representing a 5-cent increase.
The tax rate changes, coupled with the loss of property valuation in each of the towns, mean that the average school tax bill in Sea Bright will increase by $16 per year. In Monmouth Beach, taxpayers would pay $24 less per year; Oceanport taxpayers would pay $86 less; and West Long Branch taxpayers would pay $153 less per year.
Kotch said Sea Bright lost $70 million in taxable property valuation due to superstorm Sandy, Monmouth Beach lost $50 million, and Oceanport lost $30 million. Because of a 2012 revaluation, West Long Branch lost $230 million in valuation.
“Every town saw a huge reduction in their tax evaluation. Sea Bright is seeing a massive reduction,” Kotch said.
Because of both the loss of ratables and the state funding formula, which did not take Sandy into account, Sea Bright bears the brunt of the bad news. “Sea Bright’s percentage share is substantial,” Kotch said. “They were almost 14 percent last year, and an increase of almost 2 percent is substantial.
“They saw a much bigger decrease than Monmouth Beach and Oceanport,” he added. “In a town like Sea Bright, those residents whose homes were not damaged and their assessments were not decreased, they could really see a substantial hit in their taxes.”
According to Kotch, Sea Bright’s total valuation dropped from $518 million to $447 million during the past year.
The school district is in the process of applying for a Community Disaster Loan (CDL), administered by the Federal Emergency Management Agency (FEMA), to help offset some of the tax losses due to Sandy, Kotch said.
“Shore Regional and Monmouth Beach are both applying. We just got word this week from the state that we could. The state had to change some laws in order for us to do it. Prior to that, it was illegal for us to do it,” he added. “I’ve already been in contact with FEMA.”
According to FEMA’s website, the loans cannot exceed 25 percent of an entity’s operating budget, and are capped at $5 million. Kotch said a FEMA representative has indicated the loan would ultimately be forgiven.
“Our budget is $15 million, so I can get around $3 million if I’m eligible, to split among the three municipalities [affected by the storm],” he said.
If awarded, the loan would be used to close the gap between the amount the district is owed from each sending town and the amount the municipalities collect in taxes, Kotch said.
“When we strike our tax levy and certify it, the municipalities by law have to pay us,” he said. “In this situation, the municipalities are going to struggle to collect the revenues from the taxpayers.”
Oceanport Mayor Michael Mahon, who attended the meeting, said the borough has also applied for the CDL and plans to use it to offset uncollected taxes.
“What we intend to do locally is use it to fund that gap,” he said. “It’s going to be interesting; we are partners with four towns involved with Shore Regional. At the K-8 level, our partner is Sea Bright, so our interest is in making sure that difference is covered at that level as well.”
Kotch explained how the loss of value and the regional tax rates would impact the individual property owner.
“If your property value didn’t decrease, then you are going to pay a bigger share,” he said. “With the reduction in the ratable, it’s just a smaller pool of money that portion of our levy gets spread over. So for those taxpayers whose property values went down, they’ll be paying less. If your property values went up, you’ll be paying more.”
While much of the focus of the budget discussion was on the impact of Sandy, the district is saving $62,000 through an agreement in which the Shore Regional, West Long Branch and Monmouth Beach school districts share Kotch as business administrator.
Shore Regional is also saving $68,000 by sharing a superintendent with the West Long Branch School District, and $57,000 by sharing a director of curriculum with the Oceanport, West Long Branch and Monmouth Beach school districts.
The district, however, saw a $149,000 reduction in state aid, which will now be $426,679.
“There was a big decrease from 2011-12 to 2012-13, but the decrease between 2012- 13 and 2013-14 was because of a one-time allotment of state aid that we received in the 2011-12 school year that you had three years to use,” he said.
Another decrease in the budget is for transportation costs.
“Our total transportation budget four years ago was about $1.1 million, and last year we finished at $804,000,” Kotch said. “We increased the number of runs, we increased the size of our fleet — and costs have decreased over $300,000.”
The decrease in costs is the result of an investment in a newer fleet of buses in recent years that dramatically reduced maintenance expenses.
Shore Regional continues to house Monmouth Beach students, whose school was destroyed during the Oct. 29 superstorm.
“This board of education is 100 percent in favor of helping,” Kotch said. “We’ve had some visitors in our school the last five months from Monmouth Beach, and we are doing everything we can to help.”