York County school districts split on increasing taxes in upcoming budgets
With COVID-19 expenses still adding up for most districts, school boards across York County are split on whether to raise taxes on residents who might also being feeling a pandemic pinch.
Six of the 16 local school boards intend to make budget cuts or use fund balances rather than ask homeowners to pay more to cover deficits. The remaining 10 are planning to hike property taxes — in some cases right up to the maximum allowed by the state.
Most local school districts are proposing larger total budgets, with several districts anticipating bigger deficits than they have had in previous budgets. All districts must submit their final budgets by June 30.
Costs associated with the COVID-19 pandemic continue to play a big role in many districts’ proposed budgets. Cyber charter tuition costs repeatedly came up from district officials as rising expenses in both their current and proposed budgets, as enrollment rates spiked for cyber charter schools largely due to the pandemic.
Jeff Mummert, South Western School District’s business administrator, said cyber charter expenses are expected to spike in the next school year. The school board approved the district's 2021-22 budget in April.
Although he hopes students who switched to a cyber charter during the pandemic return to South Western schools, he said the district is budgeting $1.8 million for charter tuition, compared with $1.3 million budgeted this year.
“It really blew us out of the water,” Mummert said of the $440,000 increase.
Other common costs related to the pandemic included transportation, special education and equipment costs to maintain safety protocols in school buildings.
Most York County school districts did not increase taxes last year, with officials citing concerns about burdening property owners even more during the pandemic. Several districts again are planning to keep taxes flat, even though the state is allowing them to take a larger increase than they’ve been allowed in at least 10 years.
Pennsylvania’s Act 1 Index determines the maximum tax increase allowed for each school district every year. The cap is calculated by averaging changes in the statewide weekly wage and federal employment costs for elementary and secondary schools.
For the 2021-22 school year, each district in Pennsylvania was allotted a tax cap of at least 3%. The tax caps for York County school districts ranged from 3.5% to 4.9%.
Tax caps have steadily increased for all York County school districts over the last two years, but only some districts have made a habit of increasing taxes in line with what they’re allowed.
Northern York County and South Western school districts both took all or most of their allotted tax increases in their upcoming budgets, with each district allowed to increase taxes up to 3.8%. Northern York County took the full 3.8% increase, while South Western will increase taxes 3.79%.
While South Western did not increase taxes last year due to the pandemic, Mummert said that was an anomaly. It was the first time in over 10 years the district chosen not to increase taxes at all, and while COVID-19 is still a concern, Mummert said officials were more comfortable returning to a tax increase next year as the economy continues to recover.
A 3.79% tax increase would add about $117 to the average homeowner’s annual property taxes, Mummert said. It also contributes more than $1.5 million to South Western’s revenues, and Mummert said the increase will continue to benefit the district in years to come.
A tax increase is factored into districts’ standard tax rate in following years, Mummert said. This means South Western would continue to receive extra revenue from its proposed tax increase in future years, along with any additional tax increases officials choose to take. Conversely, choosing to not increase taxes means the district misses out on extra funding that year and every year following it.
At least five districts — York City, York Suburban, West Shore, Southern York County and Northeastern — are planning to increase taxes in their proposed budgets, but not up to the full amount allowed by the state.
Southern York County, which approved its budget in May, is increasing taxes 2.68% instead of its allotted 3.7%, according to Chief Financial Officer Susan Green. This will generate about $854,000 in additional revenue for the district, she said.
Green said the tax increase will help restore six positions that the district intended to restore last year before the pandemic, which limited the financial options. She said Southern York County officials didn’t opt to take the full 3.7% increase because they didn’t want to add any unnecessary burden to taxpayers.
“We can make it work with 2.68%,” Green said.
Northeastern Director of Operations Brian Geller said the district proposed a 0.8% tax increase instead of its allotted 4.1%, which would add about $330,000 to the budget. Superintendent Stacey Sidle confirmed the board approved the budget on Monday.
While Northeastern did not increase taxes last year, Geller said the district has habitually approved small tax increases in previous years and expects to do the same until at least 2028. He said all tax increases are allocated to support renovations at Northeastern High School, which are planned over the next several years.
Northeastern is one of the only school districts in York County with a surplus in its budget at about $700,000. Geller said the district accomplished this by reducing expenses. He said planning the high school renovations over multiple years allows the district to make smaller tax increases over time and mentioned that the 2021-2022 budget does not include any new positions.
"We don't look at budgets as a one-year event," Geller said.
Both York Suburban and Southern York County, along with several other districts that aren’t planning to increase taxes, will take money from their fund balances to fill their remaining budget deficits. Taking money from a district’s fund balance doesn’t have a direct impact on taxpayers, but it could have long-term effects in future budget years, according to Spring Grove Area School District Director of Business Operations Mark Czapp.
Spring Grove officials were conflicted on increasing taxes in the proposed budget. Czapp said he originally proposed the district take the full 3.7% tax increase it was allotted, but board members were split on how much of an increase the district should take. Czapp said the district ultimately approved its final budget in May with a 1.8% tax increase, which will bring in about $725,000 in additional revenue.
Last year, the district did not increase taxes at all, but Czapp said that wasn't a good option this year.
“You can’t continue to do that when expenses are increasing,” Czapp said.
Spring Grove’s budget deficit is about $5.3 million, which is one of the highest deficits among the proposed budgets across York County school districts.
If the district did not increase taxes, its fund balance will have to fill a much larger portion of the deficit. Czapp said Spring Grove’s fund balance stands at about $7.5 million. The district has enough money to fill its proposed budget deficit with funding left over, but continuing to deplete the fund balance year after year could cause financial issues down the road, he said.
Central York School District is approaching its budget differently. Earlier this year, the district’s preliminary budget projected a deficit just under $500,000. But business manager Brent Kessler said after cutting down on some expenses, they were able to eliminate the deficit and are left with a small surplus of about $10,000 without increasing taxes or taking from the fund balance.
Some of the budget cuts included removing a few new positions originally added to the preliminary budget, Kessler said. The district also cut about 10% from building budgets, which are used to fund equipment and supplies for Central York’s seven school buildings.