The Appoquinimink School Board approves a 10% operating tax increase to help cover costs for mistakes made by its former finance director.
The board approved increase is allowed under state law without a referendum because of the recently completed court-ordered reassessment. The increase will bring in over $5.2 million in new revenue
It’s needed because of the errors made by former Finance Director Eric Loftus that left the district over $1 million short to cover one month's pay. If they can’t cover that, a state takeover would happen.
A May Financial report projected the district had $7.9 million in carryover instead it was only $3 million, and $4.3 million is needed for one-month payroll.
The mistakes included the district not accounting for payroll, mistakenly covering summer school programs under federal funds, and underestimating the special education budget, extra-pay for extra responsibilities and utility costs.
"It's unfortunate that by not doing anything tonight we will not meet our carry over balance for next fiscal year, even with the cuts that we're going to present that we're going to make for next year. Matter of fact even with us not doing an increase of 10% we're not going to be able to meet carryover without going to referendum. And going on a referendum cycle," said Superintendent Matt Burrows.
The cuts Burrows mentions total $2.5 million and will come in school budgets, department budgets, and moving staff from district offices into schools - along with program, initiative and position reductions.
Compounding the problem, the district notes there was no supplemental reassessment last year which means new properties completed weren’t accounted for by the county.
Among those was a new Target which opened in Middletown in October. It was recently assessed at $22 million, and School Board President Richard Forsten says if assessed it would have helped with the gap.
"They would pay us roughly $130,000 a year in property taxes,” said Forsten. “If it had been assessed last October, when they opened, they would have paid us 3/4 of that roughly $90,000 in change, and so that's $90,000, we didn't get just because of Target this past year."
Forsten notes the district would have received about $1 million from all new properties if they were assessed last year.
The hope is to wait until later in 2027 for a referendum.
