By Bob Stiles

Published: Thursday, January 17, 2013, 9:00 p.m.
Updated: Thursday, January 17, 2013

With rising salary, insurance and retirement costs in the 2013-14 budget, Greensburg Salem school directors are taking steps in case they need to hike property taxes by more than the 1.75 mills they are permitted by law.

Directors plan to file next month to seek an exception from the state Department of Education to cover rising retirement costs.

If the state approves the exception, directors would be allowed to increase real estate taxes to approximately 2.9 mills.

Under Act 1, school districts can raise the property tax rate each year by a set percentage, or index, which is determined by several economic indicators.

Greensburg Salem's index for the next budget is 2.2 percent, or a maximum 1.75 mills, said business manager James Meyer. School boards can file for exceptions, and if the state grants them, exceed their indexed amount.

Earlier this month, Meyer explained to the school board that 1.75 mills would yield $398,000 in revenue, while 2.9 mills would bring in $462,156.

Directors begin 2013-14 budget talks with $1.7 million more in salary, retirement and projected health insurance costs than those included in the 2012-13 budget.

Teachers, administrators and other employees are scheduled to get raises in 2013-14, after not taking them this school year.

In the proposed budget, salaries total $18.34 million, up from $17.72 million in 2012-13, according to the district. Employee benefit costs are projected at $8.77 million for 2013-14, up from the current $7.66 million.

Officials are projecting $22.64 million in local revenue for the 2013-14 budget, along with $15.77 million in state money and $865,713 in federal revenue, for a total $39.27 million.

At this point, district officials estimate $41.4 million in expenses.

With no tax increase, directors would have to use $2.12 million of the capital reserve to balance the budget, leaving $370,760, according to district figures.

Superintendent Eileen Amato reminded directors that more money will be needed if they want to lower teacher-student ratios in classrooms. The district has had many classes with 25 or more students per teacher, something directors said they want to change.

Officials expect to receive an additional $287,706 in revenue by accepting a tax settlement with Columbia Greensburg SPE over the state office building on North Main Street.

Columbia requested a 5 percent discount by paying back taxes in one payment, rather than the previously agreed-upon 24 monthly payments totaling $305,000, solicitor John Scales said.

“Take the money and run,” Director Barbara Vernail said of the lump-sum payment during the board meeting.

Other directors agreed.

The district had appealed Columbia's real estate assessment from 2009 through 2013.

The district's costs for special education in 2013-14 are not enough to file for an exception, Meyer said.

Last year, directors voted against seeking exceptions that could have allowed a tax increase of up to 4.1 mills for 2012-13. They eventually imposed a 1.72 mill property tax increase in June.

State officials must decide on whether to grant the latest request for exceptions by March 7, according to the district.

Bob Stiles is a staff writer for Trib Total Media. He can be reached at 724-836-6622 or bstiles@tribweb.com.

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