The Indian River School District voted to increase resident’s tax rate by 10 percent at its special meeting July 1.
Tax rates can’t be changed by the district without a referendum – except when reassessments are carried out. And after completion of Sussex County’s first property tax reassessment in decades, school districts in Sussex can raise the tax rate between 0 and 10 percent.
Indian River residents failed to pass two referendums that would have netted about $22 million for the district. The 10 percent tax rate increase, which doesn’t include match taxes, nets about $4.6 million.
The district is also adding match taxes for technology and reading interventionists.
Indian River Board member Mark Steele said the goal is to meet the district’s payrolls and come back to the drawing board next year.
“We do some combination of the mass taxes and/or we come back next year and we're going to have to tighten the belt…” Steele said. “And we're not going to be able to let that belt out. We have to stretch our referendum, our money, our reserve money as long and as far as we can stretch it.”
That passed 9-1, with Board member Gerald Peden voting against.
Indian River finance director Tammy Smith presented the Board with four options. It could remain revenue-neutral and use historic collections; use historic collects and add match taxes; raise the tax rate by 10 percent or raise the tax rate by 10 percent and add match taxes.
The district already cut 150 staff positions and some programming. It is still looking for other funding sources beyond the tax increase.
Indian River Education Association president and school social worker Blair Catlin Brown backed the Board’s final decision during this week’s special board meeting.
“The message is simple,” Brown said. “If the board refuses to take action to bring revenue into the district, then the board invalidates their assertion that we are in dire financial straits. IRSD is in dire financial straits. So the board must take action to stabilize both our workplace and our students' learning environment.”
Smith added the district had the lowest tax rate in Sussex before the reassessment, though that could change as other districts adjust tax rates to compensate for new property values.
She said the district needs funding for a variety of projects.
“There's not enough minor cap money to replace roofs and HVAC systems all the time,” Smith said. “So that would help the district to be able to do additional projects. Technology, we funded a lot of technology through [the Elementary and Secondary School Emergency Relief Fund] and that has gone away.”
The Board treated the motion as a temporary solution and will continue to revisit funding.
