62 Districts Apply for Cap Waivers

62 Districts Apply for Cap Waivers

Sixty-two school districts have filed for cap waivers under the state’s new property tax cap law.

The law (A-1), passed in April 2007, placed a 4-percent local levy cap on school, municipal and fire district budgets. Unlike previous spending limits that restricted the growth of the school budget, A-1’s cap applies solely to the property tax levy. The law also provides districts with the ability to petition county school superintendents for waivers to the cap for specific reasons.

According to New Jersey Department of Education officials, the 62 requests for waivers are primarily for:

Special education costs, particularly out-of-district placements;
Non-recurring revenue, such as the loss of surplus that was available last year;
Energy costs;
And employer’s cost increases for the Public Employees’ Retirement System.

Waivers may also be requested for increases in hazardous transportation costs, insurance costs, sending-receiving tuition and opening a new school. Waiver requests had to be submitted to the executive county superintendent at least five working days before the budget submission date; this year, the deadline was Feb. 15.

Next Steps The Department of Education’s county offices were expected to meet as a group on Tuesday to develop consistent criteria for the review of cap waivers, according to state officials.

After reviewing the waiver requests, the NJDOE officials are expected to make their decisions late this week or early next week. In some cases, the state may require additional information from the local district.

All districts must submit an itemized budget to the county office of education by March 6. Boards must hold a public hearing on the budget between March 19 and March 27. The last day for a board to adopt its budget for placement on the ballot is March 28.

Besides creating a 4-percent property tax cap, A-1 also requires a 60-percent supermajority for any additional budget questions on the ballot, and the law used part of the 1-cent sales tax hike for property tax relief.