Feb 24, 2014 3 min read

Facing increasing pension costs combined with decreased support from state education funding, Chartiers-Houston School Board unanimously approved a $17.9 million preliminary budget for 2014-15 that calls for a 10.725-mill tax increase.

The budget is not balanced and has an operating deficit of more than $1.7 million. The tax increase also is above the index limit set by the state’s Department of Education. Like other districts considering tax increases that are higher than the index limit, Chartiers-Houston must ask for permission from the state Education Department for the increase in millage.

“We are limited on what we can raise the millage … which would be about 3 mills,” said Don Bennett, business manager for the district. “But that wouldn’t be enough. Because of the increased pension costs, plus higher costs for special education, we need to raise it more.”

The district contribution to the Pennsylvania School Employees Retirement System is mandated by the state and has been a big factor driving the budget deficits. In the 2009-10 school year, the district was required to contribute 4.8 percent, or $397,000. The contribution for the 2014-15 school year is 21.18 percent, or $1.49 million. The contributions, set by the state, are expected to increase to more than $2 million by 2017.

“The portion of the costs the school district has to pay into the fund has skyrocketed,” Bennett said. “We have to keep dipping into our reserve fund to offset the deficits without raising taxes beyond the state-mandated cap.”

Bennett said the district’s cost for special education also is expected to go up by $267,000 for the 2014-15 year over what it is paying for the current school year. The district also pays about $243,000 a year to educate 21 cyberschool students, a number that is expected to increase.

Chartiers-Houston, like some other districts across Pennsylvania, is owed money from the state Education Department for state-approved renovation and construction projects. The district has one of those projects that is owed between $250,000 and $300,000 per year.

With the reduction in the reserve fund, Bennett said it would be difficult if there were a catastrophic expense, such as something going wrong with a boiler. He called the spending plan “very lean.”

The school board voted last week, when it approved the tentative budget, to ask the state for the exception and submitted that request. The district should hear back from the state by March 26 as to whether the request has been approved, partially approved or denied, Bennett said.

“If we are denied, we still have the option of putting it on the ballot as a referendum,” Bennett said. “But I hope that is not the case because those usually don’t go well.”

While the district usually works on the tentative budget in April and May, the need to ask for the exception pushed up the approval date by several months. The final budget still will be adopted in June to meet the state’s June 30 deadline.

The current property tax rate is 110.5 mills and would go up to 120.775. Residents with a home with an assessed value of $100,000 would see taxes increase by $93.

For more information about the budget, go to the district’s website at www.chbucs.k12.pa.us.