Council Rock School Board voted unanimously to approve the preliminary 2023-2024 district budget with a planned 2 percent tax rate increase.
The $267.9 million budget would fund all aspects of the district for the next school year, including a current $2.4 million gap between revenues and expenditures.
The district’s educational initiatives fund balance will kick in $336,000 for the budget while $2.1 million will come from the undesignated fund balance. A projected $6.5 million was cut out from the original budget after several efficiencies were found.
At the suggestion of board member Joe Hidalgo, the budget will also include a rebate program for those living on fixed incomes.
Despite the board’s supportive stance on the budget, some members had concerns regarding the 2 percent tax increase not being high enough to keep the district in good financial standing moving forward.
Board member Yota Palli described several budget projections courtesy of the CRSD administration showing a steady decline in general fund balance with a 2 percent tax rate increase.
“The fund balance has a downward, domino effect, and these projections are very alarming for Council Rock. We need to have a fund balance of about 8 percent of revenue. This helps us to have savings for expenses and salaries and to keep our schools open if we run short of our projected revenue. I can not support a 2 percent increase in the final budget because I find it fiscally irresponsible,” Palli said.
Board member Ed Tate added, “Traditionally in this district, we have done a very good job of conservative budgeting. We’ve underspent by a slight amount and we end up with a balance at the end of each year of about 1% which I think is responsible. So we can get away with 2 percent this year if all goes well, but it is not sustainable. I’m concerned we are cutting this awfully close.”
Board member Mike Thorwart disagreed, opining that none of the budget projections are definite.
“I have trouble with scary numbers that say we’re going to run out of money in five years because we simply don’t know yet. I’m real comfortable with where we are, and I really think if we’re going to rattle off scary numbers, we should put the whole model up and take it apart,” he said.
“The last two years, the surplus has been $18 million total, and to tax seniors and those on fixed incomes anything more than we have to when we are not taking away any educational services, I think that’s doing a disservice to them. There’s no way I’m going to be voting for anything over a 2 percent increase,” added member Bob Hickey.
Board member Mariann McKee said, “While I do share the concerns of several on this board about future tax implications of this and other decisions, for this year and this budget, I’m satisfied with the 2 percent and I’ll be supporting the motion tonight.”
Agreeing with other board members, Mike Roosevelt opined, “We need to have a predictable rate for our taxpayers to look at. I’m concerned that if we get into the habit of keeping expenses unchecked and raising taxes to balance, we’re quickly going to be in a situation where we are going to have to rely on tax increases just to keep ourselves afloat, and that is not sustainable.”
Hidalgo, speaking from experience on the board, added, “Had we gone last year and raised taxes by 3 to 4 percent, that would have made it a lot easier for administration to get the $6 million extra they were asking for. So if you keep raising taxes, we’re going to spend it, and we’re going to spend it on good things, but at what expense to all the stakeholders?”
“I totally understand because I’ve been scared by five-year projections too, but next year, we have the same opportunity we had this year to right the ship if things get off course. If we keep raising taxes more than we really need to, it’s going to burden some of the people in our district and those will be reoccurring costs.”
Board President Ed Salamon added, “To tax somebody and have a fund balance at the end, that’s a hard sleep that night. When you find out there’s extra money and you taxed these folks, that is something you didn’t need to do. My take is a 2% increase, the recommendation made several weeks ago. I think this board can come back next year and make any adjustments necessary.”
In the end, the preliminarily budget passed without opposition.
A vote on the final budget is scheduled for June.