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ASD ponders fiscal unknowns

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By Tim Karan
Tuesday, Jan. 22, 2013, 12:01 a.m.

While uncertainty looms over Armstrong School District's immediate fiscal future, the board of directors decided not to make any decision regarding its 2013-14 budget or a potential tax increase until later in the year.

District business manager John Zenone presented the board with a preliminary budget of $97 million — up $11 million from this year — during a special meeting on Monday night in an effort to decide whether or not ASD foresees a need to exceed the state inflationary tax index before the Jan. 31 deadline.

But several unknown factors including the upcoming release of the governor's budget and a decision on the proposed Everlasting Elderton Charter School could drastically affect the district.

Current projections would leave ASD with an estimated starting fund balance of $5.9 million in July of this year, but a meager $32,000 starting balance in July 2014.

“It's gonna be a tough year next year,” said Zenone, who noted that his projections are right in line with earlier estimates made last year by the district's previous business manager.

Zenone said state and federal cuts to education have forced the district – like most others – to look for ways to save money as expenses continue to jump.

ASD expects an increase in transfers to debt service and for the cost of textbooks and general supplies to rise $411,000, transportation costs to rise $353,000 and tuition for vocational-technical students to rise $297,000.

But the biggest challenge in the district's financial future is the ever-increasing cost of employee benefits and salaries, expected to rise 64 percent next year. Salaries will go up $1.7 million while the cost of benefits will be raised $3.1 million.

“It's going to be a challenge to meet those costs,” said Zenone.

However, it's the proposed charter school in Elderton that could have immediate dire consequences to ASD.

The board conducted a public hearing with the founding board of Everlasting Elderton in December, and the district has until March to approve or deny the charter.

As the host district, ASD would be on the hook for the bulk of the charter school's revenue.

If the charter school does not become reality, ASD would only owe the state about $339,000 for charter school programs as opposed to the $2.4 million budgeted now.

“Our (deficit) is $5.9 million (for 2013-14),” said Zenone. “If we were to look 30 days back before we had our hearing with (Everlasting Elderton), that would have been $2 million less.”

Superintendent Stan Chapp said the cost of the charter school would essentially negate what ASD saved by closing Elderton Junior-Senior High School and Kittanning Township Elementary last year.

“They say it's a free education,” said Chapp. “But, no, it's a bill for Armstrong School District. Plain and simple.”

Although the district's final budget isn't due until summer, ASD can't raise taxes more than its current 1.7 percent without a referendum as part of the state's Act 1 index.

“The board has to do one of two things,” said Zenone. “They either have to pass a resolution that we're going to live within the index before Jan. 31 or they can allow us to continue going through the budgetary process and see what we can cut.”

No vote was taken, but the directors leaned towards leaving the door open. The district will also look into filing possible exceptions related to employer retirement contributions and special education, but those details are still coming into focus.

Board vice president Chris Choncek, who filled in for absent president Joe Close, said although the district will make cuts wherever possible, ASD must not forsake its primary purpose.

“Education is the top priority,” said Choncek.

“Our approach is to offer a really, really great education but at a reasonable cost to taxpayers because taxes are out of control. It's frustrating because you want to have control in cutting expenditures, but a lot of it is out of our hands.”

Although the situation often appears bleak, Zenone – who was hired by ASD last summer – offered an ounce of optimism.

“You're further along in the cutting costs process than most districts,” said Zenone. “Coming from another school district, I can tell you we're more frugal here and more efficient.”

Tim Karan is a staff writer for Trib Total Media. He can be reached at 724-543-1303 or

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