The public got its first look at the Lawrence Township public school district’s proposed budget for the 2013-2014 school year when Business Administrator Thomas Eldridge presented a PowerPoint overview of the $66.7 million spending plan during Wednesday evening’s (Feb. 13) meeting of the Lawrence Township Board of Education.
(A PDF copy of the PowerPoint overview is available from the Patch media box to the right, together with audio of Eldridge’s presentation.)
“We’ve created a budget that’s an ‘as is’ budget, which means that we don’t have new initiatives in this budget. We kept the curriculum and the goals exactly as they are and brought it one step forward. It doesn’t mean that we’re not improving. It simply means that we’re true to these goals,” Eldridge said.
As currently drafted, the budget calls for a total tax levy of $61.3 million, an increase of about 3 percent over the budget for the current school year. The tax levy increase for general operations, without debt service included, is 2.6 percent.
As a result, the school tax rate for 2013-2014 would increase 6 cents to $2.41 per $100 of assessed property value. The owner of a home assessed (for tax purposes) at the township average of $160,828 would, in turn, pay $3,876 in school taxes, or about $96.50 more than the current school year.
But in his presentation, Eldridge stressed that there are many variables still in play that could require changes to the budget. For example, he said, the district will not learn how much state aid it will receive for 2013-2014 until after Gov. Chris Christie makes his state budget address on Feb. 26.
And the district is also awaiting clarification on what impact the Affordable Health Care Act will have when it goes into effect on Jan. 1, 2014. That legislation, Eldridge explained, will require employers of 50 or more people to offer family health care coverage to employees who are not considered full-time but work an average of 30 or more hours per week.
The district, he said, could potentially need to increase the 2013-2014 tax rate even more to cover the costs of providing such health care to the more than 60 employees who fall into that category.
Part of the reason the tax rate is increasing is because the township’s tax base has declined by $27.1 million in the last year due to successful tax appeals by property owners, Eldridge noted.
“I’m going to ask you to no longer think of our budget in terms of tax rate. I’d recommend that as you look at any budget in Lawrence Township right now. The reason being is because the tax rate is unstable due to the ratable base. Instead I’d ask you to turn your attention to the actual growth in the amount of actual dollars collected.
“Lawrence Township Public Schools over the last five years have increased by 3 percent. That’s it,” he said. “The actual number of dollars we’ve asked for over a five-year period – not 3 percent each year – over five years we’ve gone up 3 percent. Over that same five years the Consumer Price Index has gone up 7 percent. It’s clear that in that time we’re beating inflation.”
Because the district’s budgets in the past few years were well below the state’s tax levy cap, particularly the last two years, the district was able to “bank” some of the allowable tax levy increases that it did not need in those years. That “cap bank” is what will allow the district for the 2013-2014 budget to raise the school tax levy beyond the state’s 2 percent limit, Eldridge explained.
“Not only did we not go up to our cap, but in some years we actually rolled backwards. And had it not been for a loss of ratables you would have actually seen decreases in taxes due to Lawrence Township Public Schools. The difference between what the tax cap allows us and where we are right now is $3.7 million that we did not raise.”
After the district is notified of the amount of state aid it will receive, it will send its proposed budget to the office of Mercer County’s executive county superintendent of education for review. The district will then hold a formal public budget hearing on March 21.
Last year, the district proposed a $67.17 million budget, with a 3-cent increase to the school tax rate, for the 2012-2013 school year. After that budget was rejected by voters in the April 2012 school board election, , which cut the tax rate hike to 2 cents.
In November 2012, acting upon legislation signed into law by Gov. Chris Christie earlier that year, the Lawrence Township Board of Education voted in favor of moving the annual school board election from April to November.
As part of that legislation, the district will now not be required to submit the 2013-2014 budget for voter approval provided that the spending plan complies with the provisions of the state’s 2 percent tax levy cap – something which, through the use of the “cap bank,” the district will do, according to Eldridge.