Centre County commissioners adopt $120M budget with no tax increase

Noon Dec. 23 update: The Centre County Commissioners unanimously approved and adopted the 2026 budget during their meeting Tuesday morning.

The Centre County Commissioners unanimously approved a tentative county budget Tuesday that would avoid a raise in real estate taxes for the 16th straight year.

The total 2026 budget is $119,962,000, with the operating budget sitting at about $116.9 million, and the capital budget at $3.1 million. The overall budget is 11% less than last year’s budget, in part due to a decrease in American Rescue Act grant funds and the completion of the county’s Community Services Building.

The county’s tax rate will remain at 7.84 mills. The budget also accounts for a 2.2% increase in revenue from real estate taxes.

“For the 225th year in a row, Centre County has passed a budget on time, and for the 16th year in a row, there will be no increase in the Centre County Government property tax millage rate,” Commissioner Mark Higgins said.

According to Financial Director Richard Killian, the largest expenditure in the budget is personnel costs, at about $48 million, or 41.2% of the budget.

The next largest expenses are service expenditures at 30.7%, operating expenditures at 13.2%, internal charges at 4.8%, debt services at 4.6%, capital expenditures at 3.4% and transfers at 1.9%.

The three largest sources of revenue for the county are grants, gifts and payments in lieu of taxes at 42.4%, or about $49 million, real estate taxes at 27.2%, or about $31 million, and charges for services at 20.4%, or about $23 million.

The remaining 10% of revenue is made up contributions and other revenues at 8.3%, interests and rents at 1.1%, court costs at 0.5% and fines and forfeits at 0.1%.

The proposed budget also includes $3,100,000 set aside for capital reserve, and while about $2 million of the general fund reserve is being put forth to cover a deficit, a reserve of 15% of the budget’s total operating expenditures is still being maintained.

With the tentative budget now entering a 20-day public review period, one commissioner hopes to use that time to try and lessen the estimated deficit and its impacts.

“Given the structural deficit that we have impacted here, I think we really need to look at it early and try to figure out ways that we can save that money,” Commissioner Steve Dershem said. “You can’t sustain structural deficit after structural deficit and keep your tax rate level, so I would hope that we might be able to have a conversation [about that].”

Dershem also said that he would also like to have another conversation about how to mitigate expenditures throughout 2026 to avoid a deficit next year.

Once the 20-day review period is up, the county commissioners plan to vote on the final budget at their meeting on Tuesday, Dec. 23.

The budget process to this point has been far from easy, thanks to the delayed Pennsylvania budget. The state budget was finally approved in November — 135 days late — and in late October, commissioners said the county was spending about $800,000 per week from its reserves to fund services.

Because of uncertainty at the state level, the county’s budget was based on flat funding, or the concept that they would receive the same levels of funding as last year.

“It’s a great deal of credit to all of our departments for being very careful when they’re budgeting, prioritizing what’s most important to meet the need of Centre County citizens,” Commissioner Amber Concepcion said. “Not knowing what we were going to have to work with from the state added an extra level of challenge, but I’m grateful for the work that’s gotten us to this point.”

This story was originally published December 2, 2025 at 5:30 PM.