Schools Deliver Identical Tax Levy for Third Year in Row

For the second year in a row, the Ocean City Board of Education approved a budget with no increase to Ocean City taxpayers.

The board on Wednesday voted to finalize a levy to Ocean City taxpayers of $21,640,721 for the 2013-14 fiscal year — the exact same figure as in the 2012-13 budget and the the 2011-12 budget.

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See detailed presentation on the new budget.
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Because the budget falls under the 2 percent cap on tax levy increases, it is not subject to voter approval.

But while Ocean City taxpayers, on average, will pay exactly the same amount in taxes next year under the proposed budget, not all property owners will see the same tax bills.

Because the value of Ocean City's tax base (combined real estate values) has fallen, the tax rate will go up. 

Owners whose homes were reassessed to lower values in the past year will likely pay less in taxes, while owners whose homes were not will pay more. It's the same situation that led the municipal government in Ocean City to propose an 8 percent increase on the tax rate to cover a 1 percent increase in spending. (See also Sandy and Recession to Deliver Double-Whammy to Tax Base.")

The tax rate increases from 19.94 cents per $100 of assessed value to 21.45 cents. The increase of 1.51 cents means property owners will pay an extra $15.10 in taxes for every $100,000 of assessed value. The owner of a $500,000 home (whose property was not reassessed) will pay an extra $75.50.

The operating budget for the district decreases by 0.1 percent from $38,786,113 in 2012-13 to $38,744,359 for 2013-14. The overall budget including debt service and a special revenue fund is $41,906,541.

The budget shows a $1.6 million decrease in tuition from sending districts (the result of fewer students and a lower per-student tuition calculation). But the district makes up for that loss with $2,294,950 in School Choice aid.

The new School Choice program allows out-of-district students to apply to attend Ocean City schools — with the state paying Ocean City $13,825 for each student. The program has allowed the district to compensate for a declining enrollment and sustain programs without increasing taxes.

Without the School Choice money, the district would need to increase the tax levy by 2 percent ($432,814) and would still have a budget shortfall of $1,862,136.

Ocean City will accept 166 students (33 at the Primary School, 39 at the Intermediate School and 94 at Ocean City High School) for the 2013-14 school year.