Plum's preliminary budget has no tax increase despite gap

Plum School District board members are not proposing a tax increase or program cuts despite a deficit in the 2019-20 preliminary budget.

Next year’s spending plan still has an estimated $457,000 gap, which officials plan to close through several options by the end of June.

“We can still do some work on the budget,” said Steve Schlauch, board member and finance committee chairman. “We’re approaching a balanced budget without taking any instructional time away from students and being good fiscal stewards of taxpayer dollars. We’ve come a long way. Things are looking good.”

Projected revenues were listed at about $64.65 million and expenses at $65.115 million.

The board adopted a resolution in January pledging not to raise taxes above the Act 1 index, a state formula used to limit real estate tax hikes.

The current millage is 21.0757. An increase to the index limit would be 21.729 mills, a 3.1 percent hike.

That means an owner of a $100,000 home would pay $65 more in real estate taxes.

District officials increased taxes, closed Regency Park Elementary, reduced kindergarten from full- to half-day and furloughed more than 20 teachers for this year’s budget.

The district reduced the shortfall from $1.1 million at the start of budget planning.

Schlauch said the deficit was reduced due to a projected $250,000 increase in state subsidies in basic and special education funding, four teacher resignations this school year and about $250,000 pulled from the district’s Access fund.

That fund includes about $100,000 from the Allegheny Intermediate Unit and more than $500,000 from the district billing other entities for special education services.

Schlauch said the district could pull more from that fund in order to help close the current budget deficit. He also expects three to five employees will retire.

May 10 is the deadline for employees to announce their retirement in order to receive incentives.

District Business Manager John Zahorchak said the board also could draw from its reserve funds in order to close the gap.

The district took out a 12-year, $5.6 million bond in June 2017 to help balance the 2017-18 budget and have funds at least the next three years. Taking $457,000 would leave about $2 million in the account.

Zahorchak said some old bonds could be refinanced for additional savings.

Delinquent tax collection and rental fees are projected to generate $70,000 more in revenue next school year, and real estate tax assessments went up from last year netting the district an estimated $50,000 in additional funds.

The district could sell some real estate for additional revenue. A vacant lot near Pivik Elementary School was put on the market for $199,000, and the Regency Park building is up for sale for $1.9 million. It was appraised at $2.5 million.

The board and administrators had a budget meeting April 16, and plans to approve its preliminary budget May 21 and formally adopt a final budget June 25.