Stronger Schools
Make a Stronger Community
Projects paid for through a district’s regular operating budget are funded 100% through local taxes. But state aid is available only for specific kinds of projects, and only when they are paid for with voter-approved bond borrowing. Waldwick’s proposed improvements would receive approximately $9,338,967 in state aid, which would reduce the total cost of $30,550,000 by about one third.
In the fall of 2022, the district will make its final payment on the bond that built the Middle School. If voters approve the April 20 bond referendum, there will be no overlap between the old bond and the new bond on property tax bills. By continuing the current tax level plus an estimated average of about $154/year per homeowner, the new, 25-year bond plan can make Waldwick schools stronger. Projections are based on a home assessed at Waldwick’s average ($418,132).
That's less than $13 a month.
State aid means Waldwick would get almost $30.6 million of improvements for less than $21.3 million in local costs.
When would the property tax bills change?
In the fall of 2022, the district will make its final payment on the bond that built the Middle School. If voters approve the April 20 bond referendum, there will be no overlap between the old bond and the new bond on property tax bills. The last assessment for the previous debt will be on 2022 bills, and the first assessment for the new debt will be on 2023 bills.
Why is bond borrowing preferred over the use of general operating funds?
State aid is promised to communities that use voter-approved bond borrowing for specific kinds of projects, and nearly all of Waldwick’s proposal qualifies for the maximum the state will give. In fact, state aid of more than $9.3 million would reduce Waldwick’s costs for these improvements by about one third. Paying for those projects within the regular budget means local taxes cover 100% of the costs, and trying to manage them within that budget would take much more time. A bond costs less and gets the work done faster.
What’s the difference between operating funds and bond funds?
School districts use operating funds to cover day-to-day costs of running the schools. In this people-heavy field, salaries make up the bulk of the operating budget. Supplies, utilities, fuel, instructional materials, and replacement furnishing/equipment make up the rest. The state allots a small amount of aid, based on the number of enrolled students, to augment the local property taxes that provide operating funds. In contrast, school districts can ask voter permission to borrow (by selling bonds) to pay for specific expenses outside that operating budget. Districts use bond funds to pay for major improvements like additional space, significant renovations, large-scale maintenance, and big-ticket equipment purchases. The state allots aid up to 40% for projects that are bond-funded, and local property taxes pay the rest.
Why would Waldwick get more state aid if voters approve this plan?
The bond proposal’s projects were strategically chosen because they qualify for the highest percentage of state aid: Almost everything qualifies for the maximum state contribution. That state aid is only available when projects are paid for with voter-approved bond borrowing. For Waldwick’s proposed improvements, the total cost of almost $30.6 million is expected to be reduced by more than $9.3 million in state aid. Without that funding method, 100% of the costs would have to be covered through local taxes that fund the district’s operating budget.
What’s the tax impact of not investing in our schools through a bond now?
Without voter approval on April 20, there will be no debt payment for schools on Waldwick’s 2023 property tax bills. The owner of a home assessed at the Borough’s average would keep about $15 a month in his or her pocket. That’s a short-term outlook, because some of the proposed projects will have to be completed with or without bond funding. Aging mechanical systems are at risk of requiring emergency repairs and the High School’s exterior will continue to deteriorate. By packaging those must-do maintenance projects into a bond proposal, Waldwick would capture about one-third in state aid rather than paying 100%. There would be a short-term reduction in Waldwick's property taxes for debt, but higher operating costs (without state aid) for these projects.