Penn Hills in line to hike taxes more than 6 percent
Penn Hills School District officials moved one step closer to raising real estate taxes by more than 6 percent and becoming one of the highest taxing districts in Allegheny County.
Board members Tuesday approved their 2019-20 preliminary budget and authorized the district to seek pension and special education exceptions to raise real estate taxes beyond state limitations through the Act 1 index.
The preliminary budget vote was 8-0 and the tax resolution 5-3 with board member Denise Graham-Shealey absent and board President Erin Vecchio and members Evelyn Herbert and Kristopher Wiegand voting against the proposed increase.
“I don’t think it should be the taxpayers’ fault that the school district’s screwed up,” Vecchio said.
The district’s debt burden of more than $172 million and climbing — mostly due to bond-funded construction projects riddled with cost overruns to build two new schools — is approaching nearly double the amount of the district’s annual budget of about $89 million.
“Take it to heart, this school district sucks,” resident Rod Sanders said after the vote. “It’s all because of the board, previous boards and the decisions you made … Not everybody lined their pockets, but a certain amount did. You have to take responsibility for that and responsibility to me is not turning it back on the shoulders and pocket books of these folks here and the other residents.”
Preliminary revenues and expenses were listed at roughly $89.9 million and $98 million, respectively, which leaves an estimated $8.2 million shortfall even with the anticipated tax increases.
The proposed budget, which will be posted on the district’s website — www.phsd.k12.pa.us — and available for review in the administration office, would raise the millage rate from around 28.7 mills to 30.6 mills, a 1.9-mill and 6.69 percent jump.
The proposed new rate would amount to the owner of a home assessed at $100,000 paying about $192 more in taxes next year.
“I think it’s ridiculous that you would even present a budget that’s not balanced,” resident Alan Lohr said. “How can you justify that and then stick it to the taxpayers?”
Superintendent Nancy Hines said it is common for school districts to have an unbalanced preliminary budget this time of year, and the spending plan is a work in progress.
“It’s just early in the stages,” she said. “We have timelines to meet. It’s not expected to be balanced at this point.”
Board members said the special meeting was necessary because a preliminary budget had to be adopted by Feb. 20 in order to seek state exceptions.
“The whole key to this thing is there’s a timetable established by Act 1,” said Rob Marra, board member and finance committee chairman. “If you don’t follow that timetable, everything’s off the table.”
School districts have to adopt a balanced final budget by the end of June.
Projected revenues include $54.6 million from local real estate taxes, $30.8 million from the state and $4.45 million from federal sources.
Projected expenses include $49.6 million for salaries and benefits, $4 million for supplies, $32 million for purchased services, $508,000 for equipment and $11.9 million in debt service payments.
Some residents questioned what the district has done to combat the mounting financial deficit.
Hines said the district has cut many positions since 2015 while maintaining crucial educational programs.
Cuts mentioned include approximately 14 percent of the teaching and administrative staff since 2015.
Administrators, food service workers and teachers took a two-year pay freeze. Hines agreed to a seven-year pay freeze. The district also sold two buildings and the state gave Penn Hills two $2 million grants the past two years.
The state Department of Education recently put Penn Hills in financial recovery status and assigned one of its former assistant superintendents, Dan Matsook, as its financial recovery officer.
Board members said they’re confident he will be able to come up with a plan to get the district back on track.
Michael DiVittorio is a Tribune-Review staff writer. You can contact Michael at 412-871-2367, [email protected] or via Twitter .