Surprise school tax bump for Seaford

Property owners in the Seaford School District will pay higher taxes next year. The school board recently approved a 16-cent overall hike in the tax rate, pushing it up to $3.36 per $100 of assessed property value.
For the average homeowner in the district, that will mean an additional $27 a year.
The tax hike will mean an additional $320,000 in district coffers: For each penny in increased taxes, the district receives $20,000.
Director of administrative services Joanna Adams proposed the tax increase to the board, which approved it by a 4 to 0 vote. Board member Mike Smith was absent.
The district is increasing its debt service tax by 9 cents per $100 of assessed value. This is the money that it collects to repay construction loans.
Its tuition tax rate is going up by the same amount. This money is used to pay tuition for students who are attending schools outside of the district.
At the same time, the match tax, money that the district collects to be able to meet required funding matches for state money for minor capital improvements, is going down by 2 cents per $100 of assessed value.
Adams said that the increase in the debt service tax was necessary to make up for a shortfall caused by a miscalculation that she had made.
In March 2011, voters approved a renovation and expansion project at the high school. The state agreed to pay $27 million of the $36 million cost, leaving $9 million to be paid by local taxpayers. The district received that money from the state in three payments.
The district's $9 million portion was to be paid back over 20 years using debt service taxes. The debt service tax rate typically varies over the pay-back period, being highest at the start of the loan and going lower as the bond is repaid.
In the run-up to a February 2014 referendum on the district's request for a hike in current expense taxes,

Adams predicted that the debt service tax rate for fiscal year 2015 would be 16 cents lower than it was in fiscal year 2014, at the time of the referendum.
That referendum failed, leaving current expenses taxes where they were. But in June of last year, the board did vote to lower the debt service rate by 16 cents, the amount that Adams had predicted.
But in her calculations, Adams had failed to add in the state's final of the three payments that it had made to the district. That payment was for $10 million, $2.7 million of which was part of the $9 million that the district had to pay back.
Adams told the board that if it did not raise the debt service tax rate, the district would not be able to make its required payment to the state in fiscal years 2018 and 2019. She also said that the district will be able to start lowering the debt service rate again for fiscal year 2020.
As for the tuition tax, the increase is based on projections from the number of students who attended schools outside of the district last year. Without the increase, Adams said, the district will run short of tuition money at the end of this fiscal year.
Adams, who was hired as chief financial officer in 2012, said that she understands that taxpayers will be upset by the 16-cent tax increase. But she pointed out that $3.36 per $100 of property value is in line with tax rates over the past five years. In 2011, residents paid $3.29 per $100. In 2012 and 2013, that amount was $3.32. And in 2014, it was $3.36.
Adams also said that the district isn't raising taxes any more than it has to. We are using all of our available resources to get us through until we can start lowering the debt service tax again, she said. There are no extras in here, not at all.

News tips wanted
Call us with ideas for news and features. We're always looking for good stories to share with readers. Call Bryant Richardson at 629-9788.