No increase in Cape school tax rate for 2025

The Cape Henlopen school board voted unanimously July 11 to set a 2025 fiscal year tax rate that is unchanged from last year.

Director of Finance Oliver Gumbs said his recommendation was based on June 30, 2024, tax assessments and state budget allocations. The tax rate will also allow the district to match all state funds provided through the state budget, including enhanced minor capital improvement funds, Gumbs said.

The 2025 fiscal year tax rate is set at $4.02 per $100 of assessed value, same as 2024. With the average home assessed value of $28,250, the average school tax is $1,138 per household.

Gumbs noted that in the 2021 fiscal year, the tax rate was $3.99 per $100 of assessed value, and that the district’s overall tax rate has increased by less than 1% in that time, resulting in an impact of about $100 to the average homeowner since then.

The 2025 tax rate proposal reflects a total property tax base of $1.5 billion, a tax base increase of $64 million, which is an increase of 4.2% from the prior fiscal year. 

The district’s collection rate on property taxes is about 95%, and if this rate occurs, total current expense collections will be about $30 million. The increased tax base will provide the district a projected increase in current operations revenue totaling $1.2 million.

The tax rate is set annually with a property tax charged to all property owners within the district based upon the assessed value of the property and is expressed in dollars and cents per $100 of assessed value. The total property tax rate is a compilation of four distinctly separate tax rates, which are current operating expenses, tuition, debt service and the match tax.

The current operating expenses tax rate can only be increased through referendum. The board sets the tuition tax rate annually to provide revenue to cover costs of district students who must attend special schools within and outside Delaware, such as Sussex Consortium, Delaware Early Childhood Center and residential schools. 

The board sets the debt service tax rate annually to meet bond payments associated with major capital improvements such as new construction and renovations. The state and Cape share in the costs of such projects, with the state contributing 60% of projected costs and the district obtaining the remaining 40% through local property tax.

The state currently has five programs for which it requires a local match, and the match tax allows districts to obtain such local funding. These programs are minor capital improvements, technology, extra-time programs, elementary school reading resource teachers and middle school mathematics teachers.

The Cape Henlopen School District annual property tax rate is the second lowest of all Sussex County school districts, and it has no capitation tax.

For more information about the tax rate and budget allocations, go to capehenlopenschools.com or email oliver.gumbs@cape.k12.de.us.