OCEAN CITY — Although Ocean City officials are wrestling with a proposed municipal budget that could raise the tax rate 7.04 percent, taxpayers won’t feel much of an additional hit from the local Board of Education.
The school board approved the 2025-26 budget May 1 with no changes from when it was first presented in mid-March.
The budget will raise the tax rate by a half-cent per $100 of assessed valuation, meaning an average-priced home in the resort — at $650,000 — will have the owner paying $32.50 more in school taxes.
School Business Administrator Timothy Kelley presented the budget before a public hearing at the May 1 school board meeting. There was no public comment.
This budget will, as Kelley noted in his original presentation March 13, include substantial tuition increases for the sending districts that include Upper Township, Sea Isle City and Longport.
Upper Township is dealing with a difficult budget year after substantial losses in state aid. (See related story, this edition.)
Ocean City has not been in the same aid situation as many others across the state because the bulk of its aid comes from School Choice money for the roughly 190 students from across the region who attend Ocean City schools. (Ocean City is one of the largest School Choice districts in all of New Jersey, ranking in the top three.)
While the state aid funding formula has been a detriment to many area schools, including Upper Township, Mainland Regional High School and Somers Point, cutting back their support, School Choice aid has remained consistent.
In fact, Choice aid rises almost $190,000 in the new budget to $3.32 million and makes up 7 percent of the district’s revenues.
The district does expect to lose just shy of $140,000 in special education aid, which will drop to $1.035 million. That, Kelley said, is because of fewer special education students in the district and a change in the funding formula. A 3 percent cap limited Ocean City’s losses; without the cap the district could have lost $285,000.
The total budget for the new school year is $52.7 million.
The general fund is up from $47 million this year to $50.86 million next year mostly due to a capital reserve fund of $3.685 million, most of which will fund a roof project at Ocean City High School.
Kelley said the roof, which like the school is 20 years old, is in good shape. To do a full replacement would cost $6 million to $8 million, but there is a state grant to cover 40 percent of the cost.
To re-coat the roof, which could give it another 20-year life, would cost $3 million to $4 million. Kelley said the district hopes to be able to use the grant for that instead, but it will take a discussion because it was slated to pay for a full replacement.
The tax levy from the budget rose $978,000 to $26.3 million, but the assessed value of properties in the resort also rose, offsetting a larger tax increase. The total assessed valuation on the island stands now at $12.949 billion, up about $175 million from the prior year.
Kelley said the tax bill for an average home will be $1,326 on a tax rate that is rising from $0.199 to $0.204. It works out to about a $5 increase per $100,000 in assessed value of a home.
School board President Kevin Barnes and Superintendent of Schools Dr. Christian Angelillo both thanked Kelley, administrators and staff for their work on the budget.
“As far as business administrators, he is the best of the best,” Barnes said, and “does an outstanding job.”
“Tim and his team did a phenomenal job,” Angelillo said. “They understand what Ocean City expects from the school and do it in a fiscally responsible way. It is a responsible budget.”
Most spending in the budget is relatively flat. Regular program instruction is $16.34 million; special programs instruction, $3.71 million; student activities/athletics, $1.2 million; student support services, $4.757 million; administration, curriculum/staff development, $3.67 million; operations, maintenance, grounds and security, $5.65 million; and transportation, $1.715 million.
Employee benefits is one area with a substantial increase, rising $582,000 to $9.058 million. This is the first time in the past four years the school district has had a tax increase.
For the past three years, the tax rate stood at 19.9 cents per $100, dropping from 21.5 cents in the 2021-22 and 2020-21 fiscal years. The tax rate was 21.6 cents in 2019-20.
Tuition up for
sending districts
In the newly approved budget, high school tuition increases $1,000 to $18,450 for sending districts. It was $15,365 in 2022-23 and $16,450 in 2023-24.
Kindergarten tuition will be $16,000 per student in 2025-26, up $1,000 from this school year after going from $12,555 in 2022-23 to $13,500 in 2023-24.
Grades one to five tuition goes up $1,000 to $18,250. It was $15,250 in 2022-23 and $16,250 in 2023-24.
Tuition in grades six to eight shows the smallest increase, rising $700 to $18,950. It was $16,250 in 2022-23 and $17,250 in 2023-24.
– By DAVID NAHAN/Sentinel staff