Kutztown School District faces a budget deficit following a rejection by more than 80% of voters to raise school property taxes by 10.6%.
The school board approved 7 to 2 the proposed final budget with a 4% tax increase and a deficit on May 21. Caecilia M. Holt and Michael Hess voted no.
“We’re down to a $170,000 deficit, and we still have time to go yet, so I feel much better about this budget cycle than I have in past years,” board member Jeremiah F. Light said prior to the vote.
The state limits how much school districts can raise taxes each year, setting that limit for each district based on factors like the number of economically disadvantaged students in the district or the district’s tax base. This year, Kutztown’s limit is 4%.
The budget and finance committee at its May 27 meeting discussed a possible 5% tax increase with a 1% Pennsylvania Department of Education-approved special education exception, which would provide an additional $1.1 million.
That additional revenue would cover the budget deficit. The remainder would go into fund balance.
Another scenario looked at a 4% tax increase with the district looking for savings to cover the deficit, such as delaying the purchase of $75,000 van and anticipating about a $50,000 increase in funding pending from the county due to finalized assessed values.
Superintendent Christian Temchatin was confident the district could get the budget deficit to zero with a 4% tax increase by the anticipated June 23 final budget adoption.
Staff Reductions
Four teaching positions are proposed to be eliminated – a high school science teacher, an elementary teacher, an English language learner instructor and a middle school librarian. Currently held by teachers who will be retiring, the positions are proposed to not be replaced.
Another proposal is to eliminate the director of curriculum position.
Donation Fund
At the May 21 meeting, one board member suggested creating a voluntary donation fund for residents who wish to contribute additional money to the district.
“I think, in light of the recent referendum, 18% were in favor of the 10.6,” said school board member Daniel Wismer. “It might be worth the board considering creating some sort of fund that those people who wish taxes to go up and … would be able to provide those funds in some way.”
Hess called this a ridiculous request, saying funding a district is a shared burden by everyone and not by a select few.
“We would typically do those things if you’re raising money to purchase something, not to cover yearly budgetary items,” said Hess.
Board member Laurel Ziegler agreed, saying that to operate at a deficit and expect to receive community donations is not sound business judgement.
While others said that if somebody wants to give more, the district could allow them to do so through, for example, an alumni or community contribution outlet.
Board president Jason B. Koch believes it would be beneficial to look at new ways of raising revenue.
“It clearly was rejected pretty heavily in the community,” said Koch, referring to referendum to raise taxes by 10.6%.
“Asking for a massive tax increase is going to fail no matter what it is,” said Hess. “Nobody wants to openly vote for more taxes. But we here as the board, our job is to appropriately fund our school district.”
Hess continued: “We put it out to a referendum because to be able to cover our deficit, we can’t raise taxes to that amount. I think we all knew that there was no way that referendum was ever going to pass.”
“I’m just hesitant to write it off, any other form of raising funds, but if there’s other avenues, why not explore them,” said Koch.
Temchatin clarified that donations are typically one-time cost versus ongoing costs because, obviously, that funding may not be there the following year. Usually, donations are handled through the Education Foundation, he said.
Source: Berkshire mont