Pine-Richland Approves Final Budget with 2.61 Percent Increase

In a 5 to 3 vote, Pine-Richland officials at Monday’s school board meeting approved a final budget with a real estate tax increase of 2.61 percent. 

The increase bridges a $1.45 million funding gap for the 2013-14 school year.

Marc Casciani, Therese Dawson and Stephen Hawbaker voted against approving the budget. Board member Victoria Goebel was absent from the meeting.

“I say we cannot support a tax increase,” Casciani said.

The final budget shows $69,541,750 in total expenditures with revenues at $69,266,250—a difference of $275,500.

To make up the remainder of the shortfall, the budget uses $275,500 from the district’s fund balance, which is typically reserved for capital improvements.

Hawbaker said he believes the district could have drawn more money from the fund balance to cover the shortfall. 

At the very least, Hawbaker said he didn’t think the district should raise property takes beyond the 2-percent index calculated for it by the state under Act 1.

Also called the Taxpayer Relief Act, Act 1 allows school districts to apply to the state for special exceptions to raise taxes beyond the 2 percent index set for it.

In Pine-Richland’s case, the district had the option to raise property taxes by up to 3.27 percent, although officials chose not to do that.  

 “I think we could absorb the difference before the index and where the tax rate is now with the fund balance,” Hawbaker said.

The 2.61 percent tax increase equals about 0.04886 mills, bringing the tax millage rate to 19.2083. A mill currently is worth about $2.4 million, according to Dana Siford, the district’s director of finance and school service.

Siford said taxpayers in the Pine-Richland School District with homes valued at median of $228,400 would pay $4,275 with no raise in property taxes.

With the 2.61 percent increase, the average homeowner will pay an extra $111 annually.

“That does not include if that was a property that would be eligible for senior citizen tax rebate program that they passed,” Siford said.

The budget does not include program or personnel cuts. Siford has said a few positions may be converted into different types of roles.

In May, district officials approved a tentative budget with a 3.1 percent increase in property taxes. However, because of updates in Allegheny County property reassessments and new construction values, the amount was changed to 2.61 percent. 

Although he did not have a specific solution, Casciani felt more cuts could be made to the budget. He added perhaps the district should reexamine the programs it offers to students.

Dennis Sundo noted the district has streamlined operations for next year. After cutting several programs in past budgets, Sundo said acting superintendent Dr. David Foley recommended not removing any more programs.

Foley added the district has slashed nearly $7 million out of the general fund budget in the last several years, including by not filling positions when people left them.

“We spoke at length at academic achievement committee meetings and decided at that time not to touch programs,” Foley said.

 Board member Dr. Jeffery Banyas said officials discussed at those meetings if any school programs could be cut.

“Nothing was forthcoming,” he said.

School Director Katie Shogun agreed with Banyas and said the district should not cut programs “with a hatchet” because of state mandated increases, including increases in employer retirement contributions.   

“To put that on the students seems unfair,” she said.

Siford said the district’s budget operations costs for next year would actually decrease by 1 percent. However, the budget for staff salaries and benefits increased by 5.2 percent—which equals about $2.18 million.

Siford said one of the biggest costs for the district is the required employer contribution to the state-administered Pennsylvania Public School Employees Retirement System.

The PSERS board mandates the contribution rate and the dollar amount public schools are required to contribute to the system. In the 2012-13 school year, districts were required to contribute 12.3 percent of employee salaries to PSERS. In the 2013-14 school year, that amount will jump to 16.93 percent.

Siford added the state is expected to reimburse the district for about half of what it pays into the system. Next year’s refund should amount to about $700,000, she said.

In other expenses, a larger principal payment for loans taken out for past building projects, including the construction of Eden Hall, also becomes due next year.

“That building, all the building that we’ve done and the capital improvements that we’ve done going back all the way to Eden Hall, were duly authorized by the democratically elected boards of this district—and we’ve got to pay for it now,” School Board President Peter Lyons said.

In the future, Hawbaker, who is not running for the school board in 2013, said he hopes officials will take an early look at the budget to examine what expenditures can be cut—including the ones the district says is beyond their control.

“I think our approach should be that there’s got to be something we can do to reduce our costs, because we have to,” he said. “We simply have to.”