Cape district eyes spring referendum

January 19, 2024 15

At the Jan. 11 school board meeting, Cape Superintendent Bob Fulton outlined the district’s next steps to address capacity following the state’s decision to deny any projects in which it would share costs, with a possible referendum to be held this spring.

The state approved the district’s request to purchase up to 59 acres of land on which to build a district office, natatorium and bus maintenance facility with local funds, Fulton said. The district can spend up to $21.4 million for a district office, $40.6 million for a natatorium and $5.9 million for a bus barn.

District plans call for moving the district office to provide space for additional classrooms at Cape High, which was also expanded in 2021.

“What they didn’t approve was the most important thing on our list, which was an addition to Cape Henlopen High School,” Fulton said. “That was the only item on the list that was a 60/40 state-district split, and it’s the only one they did not approve.”

The district also requested a portion of a larger, 103-acre parcel that includes that approved 59-acre parcel, to be financed 60/40 state-local for a future school, which also was denied, Fulton said.

Land is necessary, Fulton said, noting the state is willing to have a conversation with the district regarding allowing it to purchase more land through local funds, Fulton said.

The district has held referendums in 2014 for current expense and major capital projects, in 2016 for major capital projects, and in 2018 for both current expense and major capital projects, Fulton said. The total increase in taxes since that time is $0.37, he said.

A planned $0.25 current expense referendum in 2020 was canceled because of the pandemic.

Since 2014, he said, nine construction projects totaling $300 million have been completed, and the district has grown by more than 1,500 students.

Cape still has the second-lowest tax rate in the county, Fulton said, and does not have a capitation tax, as some other county districts do, that captures non-property owners. However, the district has budget concerns, he said.

Over the past six years, the state has reduced discretionary funding by $1.2 million annually, totallng $7.2 million that has not been restored, he said. Other funding sources include state and federal requirements that limit discretionary use of funds, he said.

The district has annual and ongoing operational needs, he said, including additional staffing to meet enrollment, safety and security enhancements, and curriculum upgrades. Pandemic-related federal grants are coming to an end, he said.

For every cent raised, the district generates $150,000, Fulton said. By increasing the current expense tax rate by $0.25, the district could generate $3.75 million, he said. The increase would equal $5.84 per month and $70.01 per year for the average household.

For the debt service tax rate, Fulton offered several scenarios that he said would be fine-tuned and presented at the Thursday, Jan. 25 meeting.

If the district followed through on all plans, the impact on the average assessed home per year would be $16.80 for property up to 60 acres and $25.21 for up to 100 acres, $35.37 for the district office, $9.80 for the transportation office, $67.49 for the natatorium and $39.21 a year for natatorium operating expenses, for a total of $247.09 per year.

However, he said, current expenses for the natatorium can be delayed while it is being constructed, and some projects can be computed without increasing the tax rate. For instance, he said, the 100-acre land purchase and district office could be absorbed through the current tax rate with no increase.

Under this scenario, the impact on the average assessed home per year would be $186.51, he said.

Fulton said district leaders will evaluate financials to decrease the numbers as much as possible and bring a final recommendation to the board for action at the Thursday, Jan. 25 meeting.