Lawrence School Budget Decreases But Still Carries 3 Cent Increase to Tax Rate Due to Decline in Ratables

Lawrence Township’s public school district was preparing for the worst when it got some surprisingly good news from Gov. Chris Christie’s office Wednesday.

“Last night, we got the news we would be receiving [a state school aid increase of] $672,000,” Board of Education President Laura Waters said at a special budget meeting on Thursday, Feb. 24.

At that meeting, the township school board unanimously approved a proposed operating budget of $64,631,951 for the 2011-2012 school year – a $425,491 decrease over the budget for the current school year.

The new budget – which includes an increase of just over 3 cents to the school tax rate – still must be approved by both Mercer County and the state. A public hearing on the budget will be held between March 22 and 29, and then voters will go to the polls on April 27 to decide whether or not to approve the budget. (The current school tax rate is $2.30 per $100 of assessed property value.)

“It depends how you look at it – if you’re a glass half-empty, glass half-full person. You can look at it and say, ‘Last year the state took $3.5 million away – this is small change.’ Or you can say. ‘Wow, we were afraid we were going to get cut more or just have flat aid and now we have $672,000 more,” Waters said. “I guess I’m choosing to be grateful for the money that’s been bestowed upon us.”

“I am also looking at it as the glass half-full. This was an amazing bit of news we got last night,” school district Superintendent Philip Meara said. “We are going to ask the board tonight to vote a budget that will give every cent of that [state] aid to the public in terms of tax relief. I never thought I would say this, but applaud the governor.”

Meara noted that the district could have, under the state’s 2 percent tax increase cap, asked for up to $59,635,436 to be raised through taxes for the 2011-2012 school year. But thanks to the increased state aid and prudent planning by the district, only $57,383,635 will need to be raised, he said.

“So we are over $2 million below where we could have been,” Meara said.

The 3-plus cent increase is due to the significant decline in tax ratables – particularly commercial properties – in Lawrence Township in the last couple years.

 “If it were not for the [decline in] ratables, we actually would have turned the tax rate backwards,” district Business Administrator Thomas Eldridge said. “We’re asking for less money to run the schools than the previous year and the only thing that prevents us from taking the tax rate down is the decrease in the ratable base.”

Prior to learning what state aid it would receive, for 2011-2012 which were based on the district receiving the same amount of aid as the current school year, receiving a reduction in aid, and receiving no aid at all. At that meeting, the school board said it was anticipating a 5 cent increase to the school tax rate.

But on Tuesday, Christie announced in his that he would increase funding for New Jersey’s public schools by $250 million. And on Wednesday it was revealed that, if Christie’s proposed state budget is approved, Lawrence Township public schools will receive $2,249,032 in state aid for the 2011-2012 school year – an increase of $672,646 from the current year.

Eldridge explained some of the challenges the district faced in crafting the new budget. “Understanding the context of our budget is critically important. Over the last two years, the ratable base – that is the total taxable value of Lawrence Township – has decreased by $122 million and for us that equates to the loss of about $2.7 million at the same tax rate,” he said.

On top of that, Eldridge said, unemployment is currently at 9.1 percent across the state – compared to 4.1 percent before the economic decline – and there has been a 17 percent increase over two years in the number of students in Lawrence Township who are eligible for free or reduced lunch.

“We’re seeing a crunch at all levels,” Eldridge said.

On top of the state aid, Eldridge noted, several things are responsible for the reduction of $425,491 in the proposed 2011-2012 budget in comparison to the current year’s overall budget.

“Assisting us are the salary freezes – all of our groupings of employees took salary freezes, beginning with the non-represented staff, followed by the principals and supervisors association, followed by LABTA (Lawrence Administrative Business and Technical Association) and the LTEA (Lawrence Township Education Association).

“We have approximately $400,000 in contributions from employees toward their health benefits helping us to keep out costs down. We have a reduction in administrative costs at all levels – we are now below the 2005 level. And as of today I calculated that solar, not including the $300,000 in grants that we got, simply by operations alone took in over $354,000 more than it costs us,” Eldridge said, making particular note of the success of the district’s solar panel initiatives.

Meara credited tax payers with helping the school board remain financially responsible.

“I do believe the community has come together. They have set us on our path,” Meara said. “We understand the need of the community.”

Meara stressed that academics will remain a priority and said the school district will still be able fund many of the things that make it stand out. Things such as small class sizes, courtesy busing, full-day kindergarten, sports and extra-curricular activities are all still in place.

When asked by the members of the public what the proposed budget means on a day to day basis, Meara answered that “You aren’t going to see anything different.” Staffing levels will remain the same, keeping the day-to-day operations of all the schools stable.

But, Meara noted, “This is all based on the budget passing.”

A PDF copy of the budget presentation made at the Feb. 24 meeting can be downloaded here.

A PDF copy of the meeting minutes is available here.

Audio recordings from the meeting can be listened to from the school district’s website.