Tax forecast for 2022-23 in the Freeport Area School District: Up in Buffalo Township, down in Freeport and South Buffalo

Buffalo Township real estate owners in the Freeport Area School District might be facing a hefty tax increase for the 2022-23 school year.

Brad Walker, Freeport Area’s business manager, said real estate owners in Buffalo Township, the district’s lone Butler County community, could be looking at as much as a 6.5% tax increase for the year.

That would mean the owner of a property with the district’s average property assessment would pay about $300 more next school year.

That would be the case if the school board raises taxes to the maximum 4.5% tax index limit set by the state. That would amount to about 10 mills, he said. The current school district millage in Buffalo Township is 154.4 mills.

Walker said the district is looking at a budget deficit of $320,000. He said if the district increases taxes to the index number, it would raise more than $700,000 in revenue.

However, he said the situation with the real estate market valuations in Butler County are in a state of flux and likely will change because of a challenge put forth by the district to the State Tax Equalization Board. The board equalizes real estate tax rates for districts that cross county borders with differing assessments and market values for its communities.

That challenge was based on one property sale of $2.1 million that skewed the market valuation and, after the successful challenge, dropped it from $60.1 million to $45.7 million, Walker said.

As a result, he said the State Tax Equalization Board is reviewing the market valuation in Buffalo Township. He expects it will change, at the very least dropping the index and shaving the potential millage increase from what was initially 11.42 mills down to 10 mills.

He said he should have a firm figure in the next week or two.

Walker and the district’s administration are recommending the board agree to hold any tax increase at or below the index figure. If the board does not agree to the index and wants to increase taxes, it would have to get approval from district voters through a referendum.

A tax decrease in Freeport, South Buffalo?

The district’s Armstrong County communities, Freeport and South Buffalo, likely will see a decline in millage, Walker said. He said development in Buffalo Township is what is causing an upward spiral in real estate values and millage.

“The market values in Butler County are going up,” Walker said. “You’re seeing homes selling for $450,000, and that’s driving the market.”

Regarding the deficit, he said: “It could have been much more severe — upwards of $1 million.”

Walker said the deficit initially was projected at $1.6 million. But it decreased because of some lower operational costs, such as reduced transportation costs, because of the covid-19 pandemic and an influx of federal dollars from the American Rescue Plan. The $1.9 trillion plan approved by Congress is designed to help American families and individuals, school districts and state and local governments in dealing with the adverse economic impact of the pandemic.