Highlands School Board cuts tax increase to 2.9 percent
The district's looming tax increase, its first in seven years, is now at 2.9 percent.
The board had been considering a tax increase of just under 1 mill, or 3.9 percent.
Instead, the board will vote on a 0.7-mill hike Monday when it also votes on passing the final budget.
For the average Highlands taxpayer, it will mean paying about $17 less than what was initially recommended by the district administration and approved by the board when it approved the $38.8 million preliminary budget last month.
Agreeing to cut it down by 0.2-mill took a considerable amount of debate and, in the end, a compromise among the board Monday night.
Board members Carrie Fox, Bill Krzton and Ron Lang wanted to cut the proposed increased by almost half, to a half-mill.
"We asked you to come up with something better. Did you come up with something better?" Director Carrie Fox asked district administrators.
Acting Superintendent Lou Baldassare and Business Manager Jon Rupert said that aside from the cuts outlined when the preliminary budget was unveiled, they were not able to come up with more.
"Our revenues were down, our interest (income) is down," Rupert said. "There wasn't much more we could do."
The budget deficit was around $1.4 million but staff cuts, including five teaching and two aide positions, and miscellaneous reductions helped to bring it down to $800,000, Rupert told the board last month.
Reducing the proposed increase by 0.2-mill will mean the district will have to make up the difference of about $300,000 from its cash reserve.
Baldassare cautioned the board about slashing the increase, noting that Highlands like most Pennsylvania school districts, is facing a major tax boost in order to meet state pension obligations.
Rupert said Highlands is looking at the prospect of raising taxes by as much as 5 mills over the next few years.
According to Baldassare, cutting more from the budget means cutting into programs, the "good things" that make the district.
As for taking more money from the cash reserve, he said, "The problem with our district is that it is so hard to make that money up."
Board member Eric Miles came up with the 0.7-mill increase as a compromise.
A majority of the board indicated a willingness to go along with that and Krzton said he would also, in an effort to present a more unified front. Fox and fellow board member Ron Lang said they still wanted it reduced to 0.5-mill while board member Karen Wantland said she was unsure of what she wanted to do.Additional Information:
About the tax hike
The average assessed value on a house in the Highlands School District is about $56,300, according to district officials. Here's what the 2010-11 tax bill would look like for such a property before the $231 homestead exemption is applied:
Old tax rate: 23.71 mills.
New tax rate: 24.41 mills.
Old tax bill: $1,335.
New tax bill: $1,374.
Tax increase: $39.