School district starts budget process

The Oceanside school district began the months long budget development process at the Board of Education meeting on Jan. 20.

Assistant Superintendent for Business Chris Van Cott led the presentation, which described how the tax levy, or property tax, is determined and how it affects the total budget. Van Cott explained that the budget comes from a few sources, including government aid, local revenues and reserved funds.

Under a 2011 law, the tax levy cannot be higher than a number determined by a formula. Part of this formula includes the Consumer Price Index (CPI), which measures inflation. The CPI is 1.62 percent for the 2015-2016 school year. The year before that, it was 1.46 percent. No matter what, the CPI is capped at two percent.

“So we’ve heard about the two percent tax cap,” said Van Cott. “When in reality, two percent is just one variable over the allowable levy growth factor right here. You still have to get through all these other steps to get to what your municipality’s allowable tax levy limit will be.”

Before the tax cap law, Van Cott explained, expenditures minus other funding sources determined the tax levy, but now the budget starts with the tax levy and adds other funding sources to result in the total money available.

“So rather than build a budget based on needs, we’re basing a budget based on available money,” said Van Cott. “Which conceptually isn’t hard to understand however, its very challenging when you have unfunded mandates, you have a gap elimination adjustment which didn’t pay Oceanside 13.5 million dollars over the last five years, state aid that’s remained the same. So it’s challenging times under the tax cap.”

The result, Van Cott said, is a budget gap that is either closed by raising revenue or decreasing expenses.

The Board of Education will review the budget “line by line” in a series of workshops over the next few months. That will end with a budget hearing on May 12 and the budget vote on May 19.