ASD Fund Balance Running Low, Might Require Tax Increase

Armstrong School Board directors last night voted unanimously for a preliminary budget that would include a tax increase for the fourth straight year in Armstrong and Indiana Counties.
By Jonathan Weaver
Even though Armstrong School District’s ‘financial footprint’ for next year is less than last year, more than a million dollars from taxpayers is still proposed to help the district float going into next year.
In a nearly-hour long special meeting at West Hills Intermediate in East Franklin Township, the six school directors present voted to adopt what is currently a $93.4 million General Fund budget that has about $2.2 million more in expenditures than revenue.
Business Manager Sam Kirk said administrators began working with him to compile the nearly-20 separate budgets into the larger in October.
“It’s been a challenging process,” Kirk said. “It’s been a total team effort on this, and it’s still not done.”
All building and department discretionary budget allocations were frozen and there was a reduction in athletic costs as officials prepare to open Armstrong Junior-Senior High and close three other local secondary schools.
Proposed expenditures did decrease $2.7 million over the current fiscal year to $93.4 million, but taxpayers can attribute the possible increase to: nearly $750,000 more in employee benefits, Lenape Technical School’s tuition cost increasing $500,000 and transportation costs rising $60,000 for two additional buses.
“The overall Lenape Tech budget’s increasing about $380,000, but Leechburg currently still has a portion of their students participating in the program – they will no longer next year,” Kirk said. “With us having 85 percent of enrolment, we’re picking up a portion of that money.”
Also, even though administrators are seeing an unprecedented amount of retirements, the state retirement contribution and healthcare rates are still in effect.
As well as $425,000 in unused sick days.
“That’s an expense no one anticipated,” Kirk said.
Due to the consolidations of Kittanning Junior High, Kittanning Senior High and Ford City Junior-Senior High, the district cut 20.5 teaching positions, an administrator, two secretaries, seven food service workers, and a school psychologist.
School directors held a brief executive session before the special meeting, and voted 6-0 on the recommended personnel items.
A pair of state subsidy amounts are still unknown – basic education and special education -, but school administrators ‘conservatively’ budgeted half of Gov. Tom Wolf’s proposal.
By June 30 – the end of the fiscal year - Kirk projects that expenses will exceed revenue by about $3.6 million, with the difference taken from the district’s General Fund balance.
Administrators have “three or four ideas” to further cut expenditures before the final budget has to be passed.
“Hopefully, you might not need any millage increase – I believe there’s a certain critical point with a $94 million budget that you don’t want to go too low with your fund balance,” Kirk said. “To me, that amount is in the neighborhood of $4-5 million – but until some of the PlanCon or the other reimbursements kick in, I’m not sure what other alternatives we have.”
In January, school directors voted not to increase taxes by more than the state-calculated Act 1 inflationary index – which was is 2.7 percent (about 1.58 mills to Armstrong County residents and 3.99 mills to Indiana County residents) according to Kirk in January. Maximizing that limit would raise $850,000 in revenue.
“One-and-a-half mills would be the maximum you could raise under the index. If we went to that amount, the median assessed Armstrong County value is $27,155, the average bill would be $1,642 next year – an increase of $40.73,” Kirk said.
Three personnel – two from the business office and a secretary in the superintendent’s office – will be furloughed under the current budget plan.
“We’ve done a great job at reducing costs at the new school, but at this point, if some of those things did not come through as we’re projecting, we may need to do that,” Kirk said.
About 54 percent of the district’s revenue comes from the state.
Property taxes rose 1.5 mills last year, requiring taxpayers to pay about $40 more.
Before millage taxes rose in June 2012, the local tax rate was steady at 55 mills for five years.
Nearly 12,100 taxpayers are qualified to receive real estate tax reductions annually under the Homestead/Farmstead Exclusion Program. Each bill will be reduced about $304.
Taxpayers can inspect the budget on the school district website or at the West Hills complex administration building until June 22 – when a vote on the proposed final budget will be taken.
School Board President Joseph Close said it is constantly difficult to keep expenses and revenues in-line. He was hopeful savings from the new school construction will exceed current projects, and praised Kirk for his diligence.
“It’s one of the harder tasks a Board has to complete annually,” Close said.
He also said the budget was preliminary, meaning the need for a tax increase could be reduced or even eliminated entirely.
“We just have to wait and see as the month goes on,” Close concluded. “There are a lot of things that are changing daily.”
School Board Directors Stan Berdell, Larry Robb and Tim Scaife were absent from the meeting.
By Snarf, May 19, 2015 @ 9:53 AM
A tax increase in ASD? Wow, imagine that. Who didn’t see this coming?
By Elderton Parent, May 19, 2015 @ 11:01 AM
Oh but the new school will save us money, right? Tax increases 2 years in a row? People cannot afford tax increases. Why was there only one Administrator cut when 3 schools closed? Why 2 more buses when busing should decrease with all those students going to one school. $425,000 in unused sick days? How about use them or lose them just like most other employers? Just ridiculous
By walrus, May 19, 2015 @ 11:39 AM
TAX INCREASE, imagine that
By walrus, May 19, 2015 @ 2:30 PM
Maybe parking meters at the fantastic new school. Seem that is the way for Kittanning and Ford City to keep going.
By goober, May 20, 2015 @ 6:34 AM
maybe asd should drop lenape. 500,ooo tuition for how many? that seems very high unless it is one of youre kids going there.
By savvynewshound, May 20, 2015 @ 8:35 AM
I’m sure it will be blamed on the prior board.
By lowfatlowcarbnosugarcheesecake, May 20, 2015 @ 11:38 AM
http://www.thekittanningpaper.info/2014/06/17/school-taxes-on-the-rise-in-armstrong/46308
Board Director Linda Walker was first to speak against the proposal, but ultimately voted in-favor.
“I don’t like it, but I can live with it. I don’t like an increase at all, but I know we have to,” Walker said.
Board Director Amy Lhote was also frustrated with the resolution and voted against raising taxes. She said she was also frustrated following the open caucus session last week when budget numbers were released.
“I can’t tell you the frustration that I felt. I know the logic of it all, but I’m just extremely frustrated,” Lhote said.
Board Director Paul Lobby was also at-first reluctant to vote in-for, concerned the the fund balance may show the tax increase is not needed anyway.
“If we come back next year with a $9 million fund balance, I’m going to propose we reduce taxes,” Lobby said.
^^^^^^^^^^^^^^^^^^
Just wanted to be the first to point out these idiotic statements for those of you who forgot…
By sickofpayingforit, May 20, 2015 @ 12:35 PM
It’s a joke. Where in the private sector do they consolidate and spend more money?
Just hired a new 164K guy, and all the other expenditures. Silicon Valley paychecks working in Mayberry. Maybe that is part of the problem??? Anyone consider that? Or is it ALWAYS the tax payers problem when the beans don’t add up?
Our ONLY hope will be if the State hits the reset button on this mess.
Apologies, although I have no say in any of this, to the seniors who are choosing between medicine and their taxes on houses they thought they owned for decades. You can rest assured at least ONE person understands that you have a fixed income situation and 100 bucks is STILL a lot of money to lots of people in ASD.
By bweitzel, May 20, 2015 @ 1:01 PM
While I certainly don’t agree with everything that happens in the district, (how many people actually get sick days anymore, let alone get paid for unused ones), I can’t imagine how much taxes would be going up without building consolidation. Don’t forget that the millions of dollars used for the new school were originally borrowed to renovate and expand Ford City, Kittanning, and Elderton High Schools. Imagine that operating budget….
By brandy, May 20, 2015 @ 1:49 PM
How can this district justify paying 14,000 more/per year to our new superintendent….if they are so low in funds???
By worthingtonman, May 20, 2015 @ 11:13 PM
Brandy Chapp started at 150,00 a year ended up around 180,00 so the new guys saves money. Plus Chapp sold back weeks of of vacation that cost upwards of 15 k a year. The new guy is cheaper. We can all be greatfull for Consolidation of as BWeitzrlnpointed out, it would be far worse. The board needs to take s stand with the next contract negotiations and force these teachers to come into line with the average taxpayers. Pay a equitable amount of money for insurance. Have a retirement plan in line with the average taxpayer.
By brandy, May 23, 2015 @ 7:19 AM
So administration deserves 6 figure salary. ..get it.. with the new school, only 1 admin. Job was cut. Guess they are more important than the staff that actually work with the students!! So it is ok to cut salaries/jobs for janitorial, café, aides, secretaries…etc… ..
As a parent… I know for a fact that.the aides will loose income in their new contract …no raise for them
By jorn jensen, May 25, 2015 @ 10:51 PM
Ahhh, sickofpayingforit, there’s at least 2 of us who understand that seniors have a fixed income situation and 100 bucks is still a lot of money to a lots of people in the ASD.
They’d better start having a lot of kids to fill these schools to get their moneys’ worth.
Good comment lowfatlowcarbnosugarcheesecake.
By savvynewshound, May 26, 2015 @ 7:55 AM
How about the fact that our teachers are among the highest paid in the state, yet our test scores don’t reflect a good product being produced?
By lowfatlowcarbnosugarcheesecake, May 26, 2015 @ 12:26 PM
Becky,
You seem to forget that the school board that borrowed that money for EHS, KHS AND FCHS were able to lower taxes. Meanwhile this school board closed KT, EHS with plans to close KHS, KJHS AND FCHS and they still have to raise taxes… twice and they still can’t build their sports stadium so you know they will keep going up.
So you can keep playing dumb, I’m going to sit over here and drink my coffee knowing that I am educated and not blinded by the school boards smoke and mirrors.
By Just sayin, May 26, 2015 @ 7:32 PM
Let Snyder and Rosebud both fund the new stadium for our community and call it the Snyder-Rosebud Stadium or Rosebud-Snyder Stadium. Who cares?! Flip a coin. Allow them to pay for it together. Most students and tax payers won’t care!! The stadium would be awesome. Pittsburghers don’t mind their “PNC Park.”
By jorn jensen, May 26, 2015 @ 10:54 PM
Correct, savvynewshound - we’re the 10th highest paid district in over 500 districts in Pennsylvania. Do we feel like we’re in Upper St. Clair, Fox Chapel, Wexford?
By wonderwhy, May 27, 2015 @ 8:58 AM
I wonder how much of the ASD budget is made up of slaries of the teachers? The teachers who have been teaching awhile are making $80,000 a year or the nine months they actually work. Pretty good salary for a district where 53% of the students are low income. The surrounding school districts highest paid teachers are not paid as much and score higher on their testing. Redbank and Karns City pay $65,000 a year to their highest paid teachers. The teachers with their high salaries have taxed us right out of people wanting to move into this area. Why should they work nine months a year and make more than a registered nurse who works all year, weekends, Holidays, shifts? A police officer who works year round with shifts, Holidays? The Board needs to revisit the payments and start these teachers out at lower salaries. They do not have any harder jobs then anyone else. So why should are taxes pay for them to have such high salaries that people won’t move here? I wonder why!
By savvynewshound, May 27, 2015 @ 9:40 AM
10th…Let that sink in. How can that even be justified?
By Just sayin, May 27, 2015 @ 10:23 AM
While they are at it, why don’t Rosebud Mining and Snyder build a new animal shelter, too?