POTTSTOWN PA – A 2013-2014 Pottsgrove School District preliminary budget of almost $61 million was accepted Tuesday (Jan. 22, 2013) by the Board of School Directors, accompanied by the potential for a property tax increase of up to 3.46 percent and, even with that revenue, the possibility of a deficit if the numbers remain unchanged.
The budget’s preliminary status, however, almost ensures changes lie ahead.
The board action, the deadline for which had been set Tuesday by Business Administrator David Nester, allows the district to advertise its intent to seek approval for an exception to its state-imposed Act 1 tax increase cap of 2.2 percent for the coming year. The exception, if allowed, would permit Pottsgrove to take in an additional 1.26 percent in taxes.
Adoption of the preliminary budget is scheduled for Feb. 12. It will be available for public review at the district offices, 1301 Kauffman Rd.
Had directors decided to stay within the 2.2-percent limit, taxes on the “average” district homeowner under the preliminary plan would have risen by no more than $95, Nester said. Approval of an exception – specifically to provide relief for pension payments the district must make to the state – would add another $60 to the tax bill, for a proposed total of $155 in additional taxes.
Act 1, also known as the Taxpayer Relief Act, is a legislative budget restriction that took effect in 2006. It was hoped to keep school districts from annually raising taxes beyond a certain percentage, called an “index,” unless higher amounts were put to a public vote. Exceptions, usually for extraordinary expenses, give districts some flexibility in the limit.
The preliminary budget, on its face, shows a deficit of $1.93 million. The proposed tax revenue, and the use of more than $500,000 withdrawn from district savings, would significantly close that gap, Nester said … but not entirely. The budget might still fall short of balance by about $40,000, he said.
“Then the challenge to us is to find that $550,000 from somewhere else in the budget,” director Michael Neiffer said.
As is the case every year, budget discussion will occupy the board’s time for several months until a final plan is adopted in June.
Related (to the Pottsgrove Board of School Directors’ Jan. 22 meeting):
Related (to the Pottsgrove School District 2013-’14 budget):
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