SPECIAL REPORT: Educational fund windfall may not translate to local tax relief

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Jul. 30—SHARON — When the state passed its budget July 8, it included significant increases to basic education which left Sharon City School District with an unanticipated $3 million.

This is the amount of the deficit the district was showing when it drew up the preliminary budget in May. and although they said in May they did not anticipate a tax increase, the board voted 6-3 to raise property taxes by 3.7%.

In a school board meeting earlier in July, Business Manager Tresa Templeton said it is possible to rescind the motion to raise taxes, but it's not likely.

"Because your tax cards are being printed due to the timing of everything," Templeton said. "It's already in motion. The tax cards are in process and will be mailed out in the beginning of August."

Templeton said the cost of producing new tax cards would be significant.

"The board doesn't meet until August so unless they do something before that ..." Templeton said.

The state budget was completed after all 500 of Pennsylvania's public school systems passed their own spending plans. Under state law, public schools must file a budget with state authorities before June 30.

Pennsylvania public school systems received greater-than-expected funding in the 2022-23 budget, with more than a billion additional dollars in basic educational, special education and Level Up disbursements, which are targeted toward poorer school districts throughout the state.

The Farrell Area, Greenville Area, Mercer Area and Sharon school districts all received Level Up funding.

Some of the school districts that are receiving additional funding raised property taxes in their own budgets before realizing that the state would be sending along more help.

Farrell Area School District, which will receive $2 million for basic education and $100,000 for special education, increased taxes in its new budget by almost 4 mills to fill a $1 million deficit.

West Middlesex Area School District, which will receive $96,400 for basic education and $55,200 for special education, raised property taxes 1 mill to close a deficit of about $1 million.

Minimal impact

In Hermitage School District, the effect will be minimal. It will receive $490,000 for basic education and $102,300 for special education. Hermitage raised property taxes 2.8 mills to fill a deficit of about $1.2 million.

Business Manager Monique Horvath said school officials already budgeted for a portion of the increased funding, with a difference of $190,010 for basic education and $50,670 for special ed between the budgeted amounts and the actual awarded funds.

Since these differences will help offset the district's budget deficit of $1,207,353, there will be no revisions to the budget.

Horath said that, while earlier knowledge of these increases would have been helpful, it still would not have negated the need for the 2.8 mill increase in property taxes approved by the school board earlier this year.

Raymond Omer, superintendent for both Reynolds and West Middlesex school districts, said the increased funds for basic education amounted to a nominal increase that could be applied to general fund expenses, but the special education subsidy "wouldn't come close" to covering increases in those costs.

Both West Middlesex and Reynolds school boards approved property tax increases, with a 1-mill increase in West Middlesex and 1.5-mill increase in Reynolds.

Omer said the increased funding wouldn't have negated the tax increases for either district, since the districts already budgeted very closely to their expenses and new costs or losses to income to occur even after the budgets are approved.

One example is how the West Middlesex schools' life skills program, which brings in students from other districts, recently lost about four or five students when those pupils' home district created its own program. Omer said this resulted in a loss of income for West Middlesex.

Another issue is the funding formula for public schools, as well as the funding formula for cyber charter school costs, which Omer described as an "unfair use of the law" for public school districts.

"The amount of increased funds into special ed wouldn't offset one or two students in cyber charter school," Omer said.

As far as some of the safety and mental health grant money was concerned, Omer said he planned to discuss some possible options with the school boards at their next meetings.

One possible use could involve safety training, such as student assistance training, or SAT, for staff at Reynolds schools, which could train staff to identify "at risk" students and how to work with them, Omer said.

"It's training people so that they have the eyes and ears necessary to help students," he said.

At West Middlesex schools, where the staff have already undergone student assistance training, district officials could look at using the grant funds to pursue a different training initiative.

State delay limited

district options

Even in districts like Sharon where the additional funding might have made a difference in tax rates, the state's delay in completing a budget may prevent them from passing the windfall to taxpayers.

Superintendent Justi Glaros said the board had not had a chance by the end of July to collectively discuss the funding increase from the state.

"That's something that's up for discussion," Glaros said.

She added that the district is very pleased with the influx of funding that was not anticipated.

"The challenge the state gives us is that they want our approved budget before we get theirs, so when we put everything together, we flat-funded because you never know what to expect," Glaros said. "So it's definitely a crap shoot in the direction that you go."

Glaros said with what has transpired since the voting of the tax increase, she anticipates the board will discuss the issue at the August meeting. The workshop meeting is scheduled for 7 p.m. Aug. 8 and the regular meeting is 7 p.m. Aug. 15.

Templeton said the level of subsidized funding included money for special education services and physical and mental health.

"We're grateful for the increase in funding, however, there was no charter school reform and we all know what that means for the district," Templeton said.