Plum School District’s 2019-20 school year budget talks have begun
Plum School District officials are trying to avoid a tax increase and find additional revenue sources to plug a projected $1.1 million hole in the 2019-20 budget.
Several scenarios were presented at the Jan. 15 budget committee meeting by district business manager John Zahorchak.
Two included no tax increases while another had a tax hike beyond the Act 1 index — a state formula that limits tax increases — to create a capital fund to address building maintenance and related projects.
Projected revenues were listed around $64 million and expenses just over $65 million.
“I believe we can and should hold the line on taxes,” said Steve Schlauch, board member and finance committee chairman. “I think the taxpayers have been drained for years.”
Zahorchak said increased pension obligations, salaries, cyber/charter school tuition and health care costs over the past several years forced the board to increase taxes, close Regency Park Elementary, reduce kindergarten from full- to half-day and furlough staff for this year’s budget.
Superintendent Brendan Hyland called 2018 “the most difficult year I’ve ever had as an educator” due to the budgetary moves and talking with those affected.
The current millage is 21.0757. A tax increase to the index would be 21.729 mills, which means an owner of a $100,000 home would pay $65 more in real estate taxes.
A tax hike beyond the index with the special education and pension exemptions could raise the millage rate to an estimated 22.024 mills. That would result in a $100,000 property owner paying roughly $94 more.
Zahorchak said the exact millage rate with the exemptions could not be determined without state approval.
A budget presentation will be posted on the district’s website later this month.
Zahorchak did not recommend a plan to the board.
“There’s a lot of unknowns,” he said. “We don’t know what the state budgets are and don’t know what the assessed values of the properties will be next year. We don’t know how many staff will be retiring next year. That’s one big variable.”
Additional revenue sources discussed at the meeting include $200,000 from the one-time sale of a vacant lot across from Pivik Elementary, $75,000 from increased rental fees, $45,000 from advertising and possible lease of naming rights at district ball fields and $45,000 from activity fees.
Activity fees would mean students pay to play in sports and other district-funded extracurriculars, something student representative and cross country runner Jonah Babusci said would not be welcomed by his peers and their families.
“Most kids play a sport, and having an additional strain of a cost would be incredibly unpopular with a large portion of the student population,” he said. “You also have to take into consideration, with activities, the families spend a lot of their own money (for equipment).”
The board did not vote on any budget items at the meeting.
Another major variable noted in the scenarios was having the Plum Borough Education Association agree to the district’s latest teacher contract proposal.
The last four-year deal expired June 30. Negotiators from both sides said they would not discuss any details prior to a new agreement being reached.
Schlauch echoed those comments when asked about the budget scenarios.
“We can’t say some of the specific things we’re trying to get done,” he said. “That’s confidential and personnel. We’re negotiating in good faith the best we can. We’re looking out for the best interest of the district and the students’ education as well as the taxpayers.”
Possible expenditure cuts mentioned at the meeting include roughly $51,800 in savings by eliminating an activity bus and $81,600 by removing a mid-day kindergarten bus run, $132,400 in replacing three retired teachers and $74,800 from not replacing a retiring janitor. The replacement teachers would make less than the ones retiring.
Schlauch said the district could save between $200,000 and $1 million by refinancing a 2010 bond issue. Savings would depend on the market and district’s credit rating.
The district has approximately $2.3 million left from a $5 million loan taken in 2017 to help balance its budgets.
Zahorchak said the amount needed to pull from that fund to balance the 2019-20 budget depends on the aforementioned revenue and expenditure moves.
Zahorchak also presented budget projections through the 2022-23 school year with various tax scenarios.
He said goals of future plans include having a $1 million capital project fund and a $3.5 million reserve fund without borrowed money.
Michael DiVittorio is a Tribune-Review staff writer. You can contact Michael at 412-871-2367, email@example.com or via Twitter @MikeJdiVittorio.
Michael DiVittorio is a Tribune-Review staff writer. You can contact Michael at 412-871-2367, firstname.lastname@example.org or via Twitter .