OCEAN CITY — After three years of no increase in the tax rate, the 2025-26 Ocean City School District budget proposes to raise taxes by a half-cent per $100 of assessed valuation.
The proposed budget includes substantial increases in tuition rates for sending districts including Upper Township, Sea Isle City and Longport.
District Business Administrator Timothy Kelley presented the budget at the March 13 Board of Education meeting, saying the owner of an average home in Ocean City valued at $650,000 would see an increase of $32.50 in his or her taxes.
The Ocean City School District (OCSD) bucks the trend of many area districts that have had to contend with substantial cuts in financial aid in recent years. The district’s state aid actually is increasing this year.
Kelley pointed out that the district has not relied heavily on traditional state aid but has regularly received money for its School Choice program that attracts around 190 students from across the region to the district each year. The state has rewarded Choice districts with consistent funding since the inception of the program.
Choice aid is up $189,930 in the 2025-26 spending plan to $3.32 million. Kelley said that represents a substantial chunk of the district’s revenues — 7 percent.
Transportation aid also is up $71,412 to $323,601, as is security aid, up $19,323 to $222,393.
Ocean City is expecting a decrease of $139,653 in special education aid, falling to $1.035 million. Kelley explained that is due to a combination of a changing aid formula and decline in the number of special education students.
He noted that the decline in special education aid had a maximum cap of 3 percent, which limited the district’s drop in funding there. Without the cap, the district could have lost $285,000, he said.
Overall, the district will receive $4.9 million in combined state aid, an overall increase of $141,012.
The total general fund for the district is $50.86 million next fiscal year, up from $47.06 million. The main cause of the increase is $3.685 million in a capital reserve for replacing the roof at Ocean City High School.
Kelley said that work may not actually get done in the coming fiscal year but the district must appropriate that in the budget to apply for a grant that would pay 40 percent of the project’s cost. Kelley said the project would not go forward if the district does not get the grant.
The tax levy for 2025-26 is projected at $26.32 million, up $978,000 from $25.348 million in this year’s budget. The district budget, like the municipal budget, benefits from the rising ratable base in Ocean City, which climbed $174.9 million over the past year to $12.949 billion.
The school tax bill for an average home would be $1,326 if this budget is approved with a tax rate of 20.4 cents per $100.
For the past three years, the tax rate stood at 19.9 cents, dropping from 21.5 cents in both the 2021-22 and 2020-21 fiscal years. The tax rate was 21.6 cents in 2019-20.
The tuition rates are going up in all grade levels for sending districts.
Kindergarten tuition would 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 also 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 showed the smallest increase, rising $700 to $18,950. It was $16,250 in 2022-23 and $17,250 in 2023-24.
High school tuition increases $1,000 to $18,450. It was $15,365 in 2022-23 and $16,450 in 2023-24.
Kelley said the district is down 23 students from sending districts, which impacts a receiving district that relies on tuition from sending districts.
There was no change in tuition for students with learning/language disabilities ($22,000), behavior disabilities ($35,000), multiple disabilities ($35,000) and preschool disabilities ($22,000).
Most spending in the budget is projected as relatively flat from this year to next with regular program instruction at $16.34 million, special programs instruction at $3.71 million, student activities/athletics at $1.2 million; student support services at $4.757 million; administration, curriculum/staff development at $3.67 million; operations, maintenance, grounds and security at $5.65 million; transportation at $1.715 million; and employee benefits at $9.058 million (up $582,000).
– By DAVID NAHAN/Sentinel staff
