In addition to raising property taxes, Moon Area school directors are considering financing a portion of the districts operating costs in 2016-17 to make up for a projected $5 million deficit in the budget.
The school board Monday adopted a proposed $75.755 million budget that would raise the property tax by 0.719 mills. The board is not planning to move forward on the financing until January or February. In the meantime, the district will work to minimize the projected deficit in order to minimize the amount we have to borrow, said Charles Lanna, interim business director.
Even though we are adopting a [proposed final] budget tonight, this is really just the beginning, board president Jerry Testa said.Our goal would be to wipe out as much as possible. Would we be able to reduce it to zero? At this point, I dont see how that would work.
The question is, where do we go from here? Mr. Lanna said. And kind of reliving history a little bit, I do not believe the district has ever been in a financial situation where we had a zero fund balance or a negative fund balance. I do not believe the district has ever had to borrow money just to balance the current year budget or balance the operations.Such a loan is called an unfunded debt loan, he said later.
In April, Mr. Lanna told the board that over the past four years, the district had used its fund balance to make up a total of about $10 million in budget expenditures. The districts projected fund balance is expected to drop to $232,153 by June 30, he said.
The districts current debt service payments continue through 2040-41 and total $226.151 million.
The proposed tax increase would raise the property tax rate to 19.5576 mills. For a home in Moon with a median value of $148,300, school property taxes for 2016-17 would increase by about $105to roughly $2,900.
Before adopting the final budget June 27, officials will look at reducing spending, meeting over the next month to scrutinize individual budgets for places to cut or purchases that can be delayed.
During a presentation to the board Monday, Mr. Lanna said staff at the district rose from 478 in June 2012 to the current 510. The number of teaching positions increased from 271 to 298 over that same period.
The districts hands are tied as to what you can do, interim superintendent Donna K. Milanovich said.
In the commonwealth, you are not allowed to furlough people for economic reasons. You have to have a drop in enrollment, which we do not have a significant drop, she said.
Curtailing programming might be something the district looks at in the future.
I would hope not, because we have wonderful programs for our students, Mrs. Milanovich said.