Cape Henlopen school board passes flat tax rate for 2025

LEWES — After two failed referendums seeking tax increases for the fiscal year that started July 1, the Cape Henlopen School District board of education Thursday approved moving forward with the tax rate set last year.

The board voted unanimously to adopt the flat tax rate of $4.282 per $100 of assessed property value for fiscal 2025.

In Sussex County and via Delaware tax code, elected school board members set property tax rates following certain guidelines, while the tax rate itself is made up of four parts.

Those parts include current operating expenses, which is set around $31.6 million and is tied to the vote; special-school tuition, which can change depending on the number of students served and the services they require; debt service, for past and present projects; and match tax, a partnership to obtain state funds based on local fiscal commitments.

Increases to cover operating expenses were rejected twice by local voters earlier this year. In May, almost 4,130 voted for the tax increase, up from about 3,600 in March. More than 4,620 voted against in May, up from about 4,200 in March.

Since the votes failed, this portion of the tax rate remains flat in the 2025 proposal.

Currently, there are minor differences between the approved proposal and the draft with regards to dollar amounts. For example, the tuition portion of the tax rate was set to go up by about $0.03 before being balanced elsewhere, but in the current document, the increase is $0.0113 before being balanced elsewhere.

As this number is set by the number of students a school serves, it changes for any additional children who move into the area and even more so should they require special services. Other changes have been made using even smaller numbers.

To offset the increase in tuition, the district has elected to make cuts elsewhere. The most significant come from decreases to the minor capital improvement budget.

For every $4 local taxpayers provide to this fund, the state returns $6. But the board adjusted this number downward by almost a penny to make ends meet here.

Funding for math and reading resource teachers was also cut, as was money for before- and after-school programs and summer school, to the tune of about $0.002 on the tax rate.

The last part of the tax rate is for debt service, which remains flat at $0.691. Currently, the district is paying bonds dating back to 2006, covering Cape Henlopen High School construction up until the last bond issuance, on July 1, 2023, for middle school construction.