Will Centre County residents see an increase in taxes as school districts plan for the start of the fiscal year?
As students wrap up online learning, school administrators are scrambling to plan for the start of the fiscal year.
With COVID-19 wreaking havoc on finances across the country, Centre County residents could see an increase in taxes as area school districts anticipate millions in revenue loss. Before educators add more financial stress to district residents and families, financial officers are working to cut costs and secure alternative sources of funding.
On Wednesday, Pennsylvania Gov. Tom Wolf announced that the state Department of Education was approved to receive $523.8 million in one-time federal emergency funds. The money is supported by the Coronavirus Aid, Relief and Economic Security Act — an initiative that provided $13.2 billion to support the continued learning of K-12 students.
“Our schools and educators have been working tirelessly to help students and their families during this crisis,” Wolf said in a statement. “These efforts must be paired with investments that reflect the unprecedented scale of this challenge. USDE’s approval of Pennsylvania’s application is an important, first step in securing those investments.”
Local education agencies can apply to PDE to receive their allocation of the funding. Once approved, they should receive funds within several weeks.
While districts wait for funds to be released, school financial officers are doing their best to budget for the unknown with estimated projects and data.
No cuts planned for State College academics, extracurricular programs
The State College Area School District predicts a $9 million decrease in anticipated revenue for the 2020-21 school year. As a result, district administrators restructured the initial budget to reduce spending and use reserve funds to make up for revenue shortfalls.
SCASD made the revisions under the assumption Penn State students will return to campus in the fall, but to avoid adding additional financial stress to businesses and families, the district opted to not increase tax rates — keeping the current rate of 46.0875 mills.
The district does not anticipate cuts in academic or extracurricular offerings, but the most recent proposal includes funding for unforeseen COVID-19-related expenses.
The average residential taxpayer will pay $3,757 in real estate taxes in 2020-21.
The final proposed budget will be presented to the board next week and voted on June 29.
Bellefonte estimates millions of lost revenue for 2019-20 school year
The 2020-21 preliminary budget has not yet been presented to the Bellefonte Area School District board of directors, but Director of Fiscal Affairs Ken Bean estimates a $1-2 million loss in revenue for the current school year alone.
Despite slight savings from not having to purchase supplies and canceling field trips, Bean said the district has not saved a significant amount of money since moving to virtual education.
“If people say you didn’t have school for the last three months, you should be saving all this money, the answer is no we haven’t,” Bean said. “We’re paying salaries. We’re paying bus contracts. We’re paying all the tuition to the charter schools, to the CPI, to all these educational facilities that we normally would have students in. We’re still paying all that.”
Bean said district administrators will be discussing three new elementary positions while considering combining some roles across the entire district to cut costs.
The preliminary budget for next year will be presented at the May 26 board meeting. The final proposal will be voted on in June.
Bald Eagle Area anticipates no tax increase for district residents
The preliminary 2020-21 budget was presented to the Bald Eagle Area School District board of directors on Thursday.
Though subject to change, BEA Business Manger Craig Livergood said the district does not anticipate an increase in tax rates — keeping the current rate of 58.9800 mills.
The 0% increase in real estate tax is partly responsible for a decrease in the anticipated revenues for next year, a projected total of $32 million.
“You’ve got some hard choices coming up,” Interim Superintendent Joseph Clapper said. “It’s a tough budget year, not just for Bald Eagle, but for everybody.”
Philipsburg-Osceola balances school, community needs
The preliminary 2020-21 budget for the Philipsburg-Osceola Area School District was presented at Tuesday’s board meeting.
Finance Director Michael Conte said tax rates will be set at $116.37 for Clearfield County residents and $50.73 for Centre County residents. Based on an equalization calculation, these rates are lower than last year, Conte said.
“That is good news,” he said. “This budget is based upon hope that the country gets through this coronavirus issue, and we still can maintain an optimistic budget.”
As part of the education funding program, the state is also allocating $206.23 in tax reductions for eligible homestead properties.
“We are trying to balance our budget concerns with the concerns of the overall community in general,” Superintendent Gregg Paladina said, “being that almost 70% of our revenue comes from state sources, which are uncertain due to what is happening right now. Tax collections across the state will be down undoubtedly.”
The final budget will be voted on at the end of June.
Penns Valley budgets without raising property tax rates
The Penns Valley Area School District is in the process of planning its 2020-21 budget.
Superintendent Brian Griffith said the district wants to respond to the needs of both students and the community.
“We will be maintaining all current educational programming and holding the line on taxes,” he said. “We anticipate needing additional reading and special education services to remediate some of the deficiencies resulting from the school closure.”
A new one-year reading specialist position will be funded with federal money and is budget neutral, and the district plans to add a special education position, which was recharacterized from a teaching positioned.
The district expects the real estate tax collection rate to drop about 2% and local earned income tax revenue has been reduced 12% in the 2020-21 budget. Overall the 2020-21 local revenue projections are expected to be $750,000 less than the 2019-20 current budget.
The median homeowner pays $2,148 in school property taxes.
“The district will use cash reserves to navigate our path through this unprecedented crisis,” Griffith said.
This story was originally published May 16, 2020 at 8:00 AM.
