Board approves tentative tax hike
The Uniontown Area School Board approved the tentative 2010-11 fiscal year budget at a special meeting Wednesday. The $41,102,927 budget includes a .58-mill increase in property taxes. The board voted 8-0 to raise taxes up to the amount allowed by Act 1, a state law also known as the Taxpayer Relief Act. Board member Paul Bortz Sr. was absent from the meeting.
The tax increase was limited after the board adopted a resolution in January limiting taxes up to a 4.2 percent index.
If the board adopts the budget as approved, a .5817 tax increase would push the property tax rate up to 14.43 mills or $144.30 for every $10,000 in assessed property value. At that rate, a person with property valued at $50,000 would pay $721.50 in property taxes.
Raising millage by half a mill will allow the district to garner an additional $396,000 under an 86 percent tax collection rate, according to Joseph Nepa, the district’s newly hired business manager who will begin working full-time in the district June 1.
Dr. Charles Machesky, district superintendent, said a projected 9.3 percent health insurance increase will eat up the additional money gained through the tax increase. Total health insurance costs are projected at $1.4 million, Nepa said.
The budget reflects a total 3.4 percent increase over the 2009-10 fiscal year budget and the elimination of eight positions held by teachers slated to retire, said Nepa. Twelve teachers are to retire by the end of this school year, Machesky said.
Nepa said preliminary figures point to a negative fund balance for the district. An audit of the 2008-09 and 2009-10 fund balance is not complete and will determine final figures, he said.
He said lack of a fund balance will translate into lost interest money and security. The money is used to pay for unanticipated expenses.
With a 3.4 percent increase in the district’s employees pension contribution expected in the 2010-11 fiscal year and additional increases to occur in the following years, Nepa said Uniontown is among many districts across the state that can’t afford that bill.
“If the state legislature doesn’t do something, this school district can’t afford that bill in two years,” Nepa said, adding that declining enrollment, healthcare costs and pension contributions are topics the board and administration need to discuss at a deeper level. “This is not a prize picture and we will have to buckle down and see what we can do.”
Machesky said district enrollment has declined by about 550 students over an eight-year period. Enrollment dropped below 3,000 students for the first time this year, he said, noting 3,560 students attended the district in 2002.
Board member William Rittenhouse Jr. said the board and administration have enacted measures, including a 2009 spending freeze, in the past to tighten spending.
“I feel we’re not going to have a lot of money to do a lot of things, but if we’re prudent with the money we have, we can manage,” Rittenhouse said.
The revenue side of the budget is broken down as follows: $12.9 million in local revenue; $23.1 million in state revenue; and $4.9 million in federal revenue.
Expenditures are listed as follows: $22.3 million in instruction; $13.7 million in support service; $707,773 in operation of non-instructional services; and $4.2 million in other financial uses.
The budget is currently balanced and the district could see $184,000 leftover “in a perfect world,” said Nepa.
Machesky commended Nepa for “a phenomenal job” on the budget, but cautioned more work must be done.
He said the board and administration will closely examine expenditures to ensure “the ship is righted” in an effort to secure a sound financial future for the benefit of the students and taxpayers.
“We’ll be working diligently on that,” Machesky said.
The board is scheduled to adopt the final budget at a 6:30 p.m. special meeting at the high school. Final fund balance figures may be available at that time.
In other news, gambling revenue will allow the district to provide a property tax reduction to eligible homestead/farmstead properties.
According to the Pennsylvania Department of Education, the district provide 5,601 homestead/farmsteads each with a $200 reduction on their property tax bills using $1.1 million allocated by the state.