State Aid is the Key to This No Tax Impact Plan
Most people avoid debt since interest payments increase the overall cost of a purchase. New Jersey School Districts can realize savings by issuing debt through an approved bond referendum. Debt Service Aid provided by the state saves the local community 34% of the cost for eligible capital improvements. The state has committed to offering 34% or $314,840 towards the replacement of the fire alarm system at Delaware Valley Regional High School.
How Can the Fire System be Updated and Replaced Without an Added Tax?
The district has thoughtfully planned and built a Capital Reserve Fund. Capital Reserve Funds can only be used for capital improvements. The current balance in the district capital reserve is $1.6M.
Capital Reserve is Like a Savings Account
Purpose: Funds are strictly used for the local share of long-range facilities plans or capital projects exceeding educational efficiency standards. Monies cannot fund general fund current expenses.
Deposits & Withdrawals: Boards may fund reserves via annual budget appropriations or year-end transfers of unexpended line-item appropriations by board resolution. Withdrawals require budget inclusion or specific approvals.
Investment Earnings: Interest or capital gains earned become part of the reserve account and must be budgeted appropriately.
Allowable Use of Funds: A board of education may transfer funds from the capital reserve account to the debt service account for the purpose of offsetting principal and interest payments for bonded projects which are included in the district's long-range facilities plan.