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Every July, Your School Board Makes One of the Biggest Financial Decisions Most Taxpayers Never Hear About

By 38th Reporter


Most taxpayers probably don't realize that every July, the Indian River School Board makes one of the most important financial decisions of the year—setting the district's local school property tax rates for the upcoming fiscal year.


Unlike a school operating referendum, these annual tax decisions do not require a public vote. Under Delaware law, they are made by your elected School Board. However, taxpayers can—and should—let their Board members know what they would like to see before next July's vote, as this year's decision has already been made.


At the end of this article, you'll have an opportunity to participate in a brief poll and share your opinion on the future use of Match Taxes in Indian River.


This year, the Board considered several options that ranged from:

1. reducing taxes

2. keeping them the same

3. modestly increasing certain tax categories authorized under Delaware law, known as "Match Taxes."


Choices of options ranged from one option that would have increased the average property owner's school taxes by approximately $34.33 per year, while another would have reduced taxes by a few dollars. Ultimately, the Board approved the option that kept the overall school tax rate unchanged, while adding a third State Match Tax.


The discussion raised a fascinating policy question every taxpayer should consider:

If investing approximately $40 locally could bring another $60 in State education funding back to Indian River schools, would you support it?

That question led to nearly forty minutes of discussion about student achievement, school buildings, future construction, state funding, taxpayer responsibility, and the growing financial pressures facing public education. You can watch the board meeting for yourself here: Indian River School District Board of Education Meeting 7/1/26



So, What Are Match Taxes?

The July 1 Board discussion quickly centered on Delaware's optional State Match Tax programs—a funding tool many taxpayers have probably never heard of. They are called "Match Taxes" because local tax dollars are matched with additional State funding for specific purposes authorized by Delaware law, that local district tax payers don't pay for directly.


The real advantage of Match Taxes is their ability to leverage local tax dollars - funded at roughly 40% locally and 60% by the State. Instead of local taxpayers paying the full cost of a qualifying program, they provide about forty cents on the dollar while the State contributes the remaining sixty cents. In other words, every local dollar invested brings additional State education funding back into Indian River.


Here's an easy way to think about it: If Mio Fratello handed you a coupon that said, "Spend $40 and we'll kick in another $60," would you throw it away? Probably not. You'd first ask, "What am I getting for the $100?". That's exactly the question with Match Taxes. They aren't "free money"—local taxpayers still have to put money in first. But every local dollar brings additional State dollars to the table. The debate isn't whether the match exists. The debate is whether the programs being funded are worth the investment.


Several Board members viewed Match Taxes as an opportunity to make local tax dollars work harder by bringing additional State education funding back into Indian River. There are 7 separate categories of Match Taxes that are available to the Indian River School District, and most are directly to student education.


During the discussion, to better understand the options before the Board, Board member Dr. Michelle Parsons asked the administration to clarify exactly what was before the Board, including how much additional revenue could be leveraged from State funding and what the impact on the average taxpayer would be if the district eventually adopted all of Delaware's optional Match Taxes.


As part of that discussion, Parsons noted:

“We fund them 40%, but the state matches us 60%, and they're really geared towards student education and reading and math,” she said. “And I feel like it's a great way for us to leverage additional funds.”

Chief Financial Officer Richard Parker explained that if Indian River adopted all of the eligible Match Taxes, the average property owner's school taxes would increase by approximately $34.33 per year, while allowing the district to leverage substantially more State funding for targeted educational programs.


Last year the Board opted to participate in two Match Taxes: Technology, and Reading Interventionist. With this year's vote, Indian River now participates in three of Delaware's optional State Match Tax programs, adding the Enhanced Minor Capital Improvements Match Tax.


The Three Approved Match Taxes for This Year Are:


The Technology Match Tax helps maintain and replace classroom computers, instructional technology, and network infrastructure.


The Reading Interventionists Match Tax funds specialists who provide targeted reading instruction for students who are struggling before they fall further behind.


The Enhanced Minor Capital Improvements Match Tax, approved at this meeting, helps fund repairs and improvements to existing school facilities, including roofs, heating and air conditioning systems, plumbing, electrical systems, sidewalks, parking lots, and other infrastructure that extends the life of school buildings while qualifying for additional State matching funds.


Match Taxes NOT Approved This Year:


During the discussion, Board members also reviewed Delaware's remaining optional Match Tax programs, including Reading Resource Teachers, Mathematics Resource Teachers, Extra Time intervention programs, Opportunity Funding (for low income students), Athletic Trainers, and Substitute Teachers (which IRSD does not qualify for).



If Match Taxes Are Such a Good Deal, Why Didn't the Board Adopt All of Them?


That became the central discussion of the meeting. Chief Financial Officer Richard Parker explained that if Indian River adopted all of the remaining eligible Match Taxes, the average property owner's school taxes would increase by approximately $34.33 per year.  Some Board members asked whether roughly thirty-four dollars per year was a worthwhile investment if it unlocked substantially more State funding, approximately $5 million, dedicated specifically to student learning and school facilities. Others believed the district should move more cautiously.


Although Match Taxes can significantly enhance student programs, they cannot pay many of the district's largest expenses.


As Mr. Parker explained:

"I can't pay any utilities with any of this money... I can't pay the majority of our local fund teachers out of any of this money." 

Those unrestricted expenses—including utilities, transportation, employee benefits, inflation, and many classroom salaries—must continue to be paid from the district's general operating budget. Those financial pressures are one reason Indian River is expected to seek an operating referendum in January 2027.


Unlike general school taxes, Match Tax dollars are restricted. The district cannot simply move the money wherever it wants. If taxpayers approve funding for reading specialists, those dollars must be used for reading specialists. If they approve funding for building maintenance, those dollars must be used for building maintenance. They cannot be redirected to pay utility bills, transportation costs, employee benefits, or many other day-to-day operating expenses. Although this restriction could also be seen as a positive, if match tax funds are directed specifically to educating students, such as math and reading specialists, then they can only be used for those specific education needs and services.


Another Important Discussion: Debt Service

Another topic that generated significant discussion was Debt Service, a portion of your school taxes that many taxpayers understandably find confusing. Think of Debt Service as both the district's mortgage payment and its savings account. It pays the principal and interest on bonds previously issued to build and renovate schools while also building reserves for future construction projects. Building those reserves helps avoid asking taxpayers to shoulder the entire cost of a new school or major renovation all at once.


Mr. Parker cautioned that reducing the Debt Service tax too aggressively today could leave taxpayers facing larger tax increases later if the district needs another school or major renovation. At the same time, the administration recommended a modest reduction in the Debt Service tax—just enough to offset the addition of the Enhanced Minor Capital Improvements Match Tax. The result was a plan that kept the overall school tax rate unchanged while leveraging additional State funding for school facilities.


That recommendation also came in the context of the State Auditor's finding that Indian River's debt service reserve "exceeds 110% of Total Debt Expenditures for the Following Year." The Board ultimately accepted the administration's recommendation, concluding that a modest reduction in the Debt Service tax could be made while still maintaining what it believed to be an adequate reserve for future capital needs.


The Conversation Expanded Beyond Taxes

As the discussion continued, Board members broadened the conversation to the increasing financial pressures facing Delaware school districts. Rising energy costs, inflation, employee benefits, and a growing number of unfunded state mandates continue placing additional costs on local property taxpayers.


Dr. Michelle Parsons summarized the challenge, and echoed by Mrs. Leolga Wright, with a familiar expression:

"The squeaky wheel gets the oil." 

The point was simple. If school districts never communicate these financial pressures directly to state leaders, those leaders may never fully understand the burden being placed on local taxpayers. In response to a request from Board member Dr. Parsons about whether the district would start communicating its financial concerns to the state in writing instead of keeping them as internal discussions, the district Superintendent agreed.


Superintendent Dr. Jay Owens agreed.

"Yes... we can do all of that." 

He explained that Indian River already works with superintendent associations, Sussex County school districts, and legislative organizations, while expressing support for continuing to strengthen those advocacy efforts.


Even the lone dissenting Board member, Mr. Gerald Peden, praised the district's long-standing fiscal stewardship, stating:

"The taxpayer should be very happy with us... we're very prudent with our expenses... they should be very proud of what we're doing." 

Whether District taxpayers agree with this sentiment or not, remains to be seen.


The Board's Decision

After reviewing four different options, the Board approved "Option 3": The plan that reduced the Debt Service tax while adding the Enhanced Minor Capital Improvements Match Tax, allowing the district to leverage additional State funding without increasing the overall school tax rate. 


For many Board members, the discussion wasn't simply about this year's vote. It was about whether Indian River should develop a long-term strategy for making greater use of programs that leverage State funding while continuing to protect taxpayers and advocate for relief from unfunded mandates.


Ultimately, every School Board member must balance two important responsibilities: being a good steward of taxpayer dollars while providing students with the best educational opportunities possible.


We Want to Hear From You!

Every July, your elected School Board decides whether to keep local school taxes as low as possible or ask taxpayers to invest a little more in specific educational programs that leverage additional State funding. Reasonable people can disagree on where that balance should be.


What matters most is that taxpayers understand the choices before the vote is taken and have an opportunity to share their views with the Board.


Unlike a referendum, taxpayers do not vote directly on Match Taxes. Instead, your voice is heard by communicating with your elected School Board members before they cast their votes.


Please Take the Poll Below: Would you support adopting the remaining eligible Match Taxes of about $34 per year in additional school taxes per average property owner if it unlocked more than $5 million in additional State education funding for Indian River, funding it would not otherwise receive? The additional State funding would go specifically toward these categories:


  • Technology

  • Reading Intervention

  • Reading Resource Teachers

  • Mathematics Resource Teachers

  • Extra Time (remediation/extended learning)

  • Opportunity Funding (low-income students and English learners)

  • Enhanced Minor Capital Improvements


Would you support Match Taxes if $34/year unlocked $5M+ in additional State education funding?

  • Adopt all remaining Match Taxes (7/7) $34 a year

  • Keep only current Match Taxes (3/7) $0 no change

  • Cut the current 3/7 Match Taxes (0/7) decrease taxes $2-15?

  • Other?




We encourage every taxpayer to watch the full School Board discussion and reach their own conclusions.


Whether you believe taxes should be lower, higher, or remain the same, your opinion matters most before—not after—the annual July vote.


Good stewardship isn't simply about spending more or spending less. It's about making informed decisions, maximizing every taxpayer dollar, and ensuring taxpayers have a voice in how those dollars are invested.




See you Monday, August 3, at our next 38th District and Southern Delaware Republican Club at Millville Town Hall, on Club House Drive, 6:30pm.


Guest Speaker: Jane Brady and where we stand now with Offshore Wind.




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This newsletter is intended for informational purposes only. The content provided is for general information and entertainment purposes, and should not be construed as professional advice. The views and opinions expressed in this newsletter are those of the authors and do not necessarily reflect the official policy or position of the Club. Readers are encouraged to seek professional guidance or conduct their own research when making decisions based on the information provided in this newsletter. The Club does not guarantee the accuracy, completeness, or usefulness of any information presented in this newsletter and will not be held liable for any errors or omissions. Website paid for by the 38th District Republican Club PAC and not authorized by any candidate or candidate’s committee.


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