ShareThis Page

Plum school taxes to rise 4.4 percent, and district to borrow more

| Wednesday, May 17, 2017, 10:42 p.m.

Plum School District property owners should expect to pay 4.4 percent more in real estate taxes next school year, and the school district still needs to borrow more to balance the budget.

Board members voted 6-3 at a special meeting on May 17 to approve a preliminary 2017-18 budget.

Board President Kevin Dowdell, Vice President Michelle Stepnick and fellow School Directors Jim Rogers, Reginald Hickman, Michele Gallagher and Rich Zucco voted in favor.

Sue Caldwell, Steve Schlauch and Vicky Roessler dissented.

The proposed budget totals around $65 million and includes a 0.866-mill property tax hike.

The state inflation-based index would have allowed Plum school leaders to raise taxes by only 0.659-mill. But the state Department of Education last month approved the district's request to increase taxes above the Act 1 index — a formula that limits tax increases — because of increased pension costs.

Business Manager John Zahorchak said the next school year's pension obligation is projected to rise by nearly $1 million, to $9.7 million.The budget draft includes a $4.1 million deficit projected for the start of the school year, but doesn't call for teacher furloughs or program cuts.

The current tax rate is 19.377 mills; the increase, as proposed, would increase millage to 20.243. One mill generates about $1.5 million in revenue for the district.

A property owner with a home assessed at $100,000 would pay about $86 more, if the current budget proposal is approved.

The new property tax bill on such a property would be $2,024.

District to borrow

The board also voted 6-3 to pursue a 12-year, $5.6 million bond to increase revenue over the next three years. Zahorchak said about $5 million will be used toward district expenses, and the rest will go to fees and reimbursements from the state.

He said $1.4 million will be used to balance the 2017-18 budget, $3 million in 2018-19 and the rest in 2019-20. The district also took out a $5 million loan last year to help pay for pension obligations and transportation expenses. Zahorchak said he anticipates some minor tweaks to the budget prior to next month's final passage such as updated state and federal revenues, but nothing that would change the tax hike.

The budget will be posted for 20 days prior to adoption. “I'm happy that the budget got approved tonight,” Zahorchak said. “I'm happy about the transparency that went through the process of passing this budget. I think it was all out there for the public.

“I'm happy we didn't cut programs. I'm not thrilled about having to borrow money to have to pass the budget. The deficit is still existing, and we've got to find ways to close that gap.”

Schlauch said he opposed the budget because of the tax increase, having to take out a loan to balance it and a lack of expenditure cuts.

“We shouldn't be borrowing money we don't have,” he said. “It's irresponsible and it digs a deeper hole. We're putting all the burden on the taxpayers by raising taxes. We're doing next to nothing on the expenditures side. We need to make cuts.”

Zucco said he was not in favor of raising taxes or taking out a loan either, but the board had to do something to balance the budget. “This is Plum's last chance to turn things around,” Zucco said.

Dowdell said time was wasted with infighting instead of better budget planning. “We probably could have done a little more if we hadn't spent so much time bickering,” he said. Dowdell said he would have liked the district to recruit Chinese students to increase tuition revenue for next year, but “we just ran out of time.”

Michael DiVittorio is a Tribune-Review staff writer.

TribLIVE commenting policy

You are solely responsible for your comments and by using you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.