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Treasurer explains homestead/farmstead calculation on tax bills as state budget delay limits investments
Summary
Treasurer Mr. Enders walked the board through how homestead and farmstead exclusions are applied to tax bills and said the district is limiting investments because it is not receiving state funding during a state budget impasse.
At the Aug. 25 Jersey Shore Area School District board meeting, Treasurer Mr. Enders explained how homestead and farmstead exclusions are applied on individual tax bills and warned that the district's ability to invest funds is constrained while state funding remains unsettled.
"The tax bills are correct," Enders said as he reviewed a sample tax bill and the underlying math. He walked the board through a worked example: an assessed value of $79,300 with a homestead exclusion valued at $22,262 produces a taxable assessed value of $57,038. "Multiply these taxable assessed value by the rate. That's when you get your base amount due. Face amount due is $1,064," Enders said. He explained the discount and penalty are calculated from that base amount; the discount rate is 2 percent and the penalty rate is 10 percent.
Enders and other district staff also described how the statewide budget impasse has affected district cash management. Enders said the district reduced short-term investments in July because it is not receiving state funding and needs to preserve liquidity: "We could not go and grab any short term investments to invest because at this point in time, we are not receiving any state funding, and we can't afford to tie up that money in any way, shape, or form."
Board members asked clarifying questions about why certain dollar lines appear on the printed tax bill and whether the discount and penalty amounts shown at face value can mislead taxpayers. Enders said some printed dollar figures on the bill can be confusing because they show the discount and penalty applied to a face amount rather than to the adjusted taxable amount after exclusions; he suggested the district may remove or change those printed dollar lines next year to reduce confusion.
Enders also noted the board approves the assessed value used for the homestead/farmstead resolution rather than the dollar credit printed on the bill. "You don't approve the dollar value of your homestead credit. You approve when you approve the resolution for homestead farmstead, you approve the assessed value of the homestead farmstead," he said.
The board did not take formal action on the matter Aug. 25; the exchange was presented as education for board members and taxpayers.
