Hampton Township School Board caps tax increase

A 1.15-mill real estate tax increase will be the maximum in Hampton Township School District for 2024-25, and early projections have the number slightly lower.

The school board on Dec. 4 approved a resolution not to raise the rate by more than 5.3% over the current year, a figure that represents the ceiling established for the district by the state Department of Education.

“Just to be clear, we are not voting to pass a budget or raise taxes,” Jill Hamlin, board president, said. “We are just voting that we are not going to exceed that Act 1 index.”

Legislation adopted as Act 1 of 2006 calls for a statewide base index that takes into account each year’s changes in wages throughout Pennsylvania and in school employee compensation costs nationally. From there, the index is adjusted for individual school districts based on relative wealth.

In advance of Hampton’s not-to-exceed resolution, Jeff Kline, district director of administrative services/transportation, and his staff developed a proposed preliminary budget. Projections in the document indicate that with a property tax increase of 1.05 mills, revenues would meet expenditures.

The current rate is 21.85 mills, but taxpayers shouldn’t start counting just yet.

“It’s not the budget that you’re going to see from us come April, which is going to be a budget that basically includes input from every department,” Kline told the board. From there, a final 2024-25 spending plan must be adopted by June 30.

Coming up with projections so early was necessary, Kline explained, because school districts must file not-to-exceed resolutions with the state by Jan. 4, a few weeks ahead of the usual annual deadline. The 2024 anomaly results from the scheduling of Pennsylvania’s primary for April 23, earlier than normal because of the presidential election year.

Under the conditions of Act 1, not-to-exceed resolutions basically are formalities. The typical Pennsylvania school district is unable to raise the tax rate by an amount higher than its index unless voters approve the measure by referendum.

Whatever the case, Hampton’s proposed preliminary budget gives insight to the district’s financial picture under the weight of perpetually rising expenditures.

The document lists projected spending for 2024-25 at slightly over $64 million, representing an increase of $2.673 million, or 4.35%, over the current year. The projection for revenues at the current real estate tax rate is just under $61 million — up $931,600, or 1.53% — leaving a shortfall of $2.41 million.

Bridging the gap would entail raising the rate by 1.05 mills while using $300,000, the scheduled allocation for 2024-25, from a stabilization fund originally established by the district 14 years ago to cover employer contributions toward the Public School Employees’ Retirement System. In 2020, the fund’s purpose was amended to include maintaining educational programs during the period of economic uncertainty caused by the covid-19 pandemic.

The fund allocated $400,000 for 2023-24.

“I’m projecting that we’re going to better that by about $296,000. My current projection for the deficit is about $104,000, predominantly due to additional state revenues,” Kline said. “Also, our cyber/charter school enrollment has decreased as we look further and further back at the pandemic.”

He pointed out that several factors that will impact the 2024-25 budget significantly have yet to be determined, including the district’s PSERS obligation, staffing needs and health insurance premiums. A 15% increase is projected for the latter, according to the proposed preliminary budget.

Along with approving the not-to-exceed resolution, the school board reorganized on Dec. 4. Hamlin was reelected as president, and Matt Jarrell, vice president.

Board members elected in November were sworn into office: newcomers Maureen Farrell Perkins and Jenny Kennedy, and incumbents Jarell, Joy Midgley and Robert Shages.