ARMAGH — United’s school board directors got a detailed look at the 2013-14 budget Tuesday, and, as it stands, the school district is looking at a deficit of approximately $2.7 million and will be looking at budget reductions in upcoming work sessions.
Finance Director Tammy Tuccarello presented the information in a work session following Tuesday’s regular meeting.
The estimated revenues for the preliminary budget at this point, she said, are $17.9 million, “only 2 percent higher than the revenues that you were anticipating last year at this time,” which equals about $364,000.
The district is looking at total expenditures of $20,629,000, Tuccarello said, $1,375,000 higher than the expenditures in last year’s preliminary budget. The biggest hits are coming from salaries and benefits, debt service and tuition for cyber-charter schools, Tuccarello said. There are also a lot of technology purchases in this year’s budget as well.
The district has a fund balance of $6,397,000, which has been used in previous years to cover budget shortfalls. Tuccarello said she doesn’t want to project yet because “it’s a little early on where we’re going to end up, but as we go further into this process we’ll be able to get a better projection.”
She said if the preliminary budget were to be submitted right now the way it is, with the $2,706,000 deficit, “we would be using a good portion of your fund balance,” leaving it with roughly $3.6 million.
Tuccarello said that about 40 percent of expenditures will go toward salaries and approximately 22 percent will go toward benefits. What’s currently included in the salaries “until we have some further discussions,” is the replacement of three elementary teachers whose retirements the board accepted Tuesday. Second-grade teacher Maxine Toth, elementary librarian Alexandria Marguccio and elementary art teacher Darleen Tishock submitted letters of resignation to the board effective at the end of the 2012-13 school year.
Also, in anticipation of the Pre-K Counts grant approval, she said, the district would need to hire two additional teaching positions and two additional aide positions, which have been included in the budget to offset the money the district would get back from the grant from the state.
As far as benefits go, the retirement rate is increasing to 16.69 percent, a 4.43 percent increase over last year’s rate, Tuccarello said. The district is also looking at a 10.9 percent increase in health care costs, according to the ARIN consortium. Tuccarello said their final numbers are not yet finished and won’t be for another month or so. Last year, she said, they predicted a 12 percent increase but came back with frozen rates. She said she doesn’t imagine rates will be frozen again this year.
Tuccarello also told the board that the district’s tax collection rate has been hovering around 82 percent for the last four or five years. One mill equals roughly $48,000, but since the collection rate is only 82 percent, the district is collecting only about $39,000 to $40,000 for that collected mill in taxes, she said. The current millage rate for the district is at 96.35. The real estate tax makes up 68 percent of all of the district’s local revenues, Tuccarello said. The earned income tax represents 15 percent of all local revenues for the district.
Tuccarello said when she calculated out the millage for 2013-14, the rate goes from 96.35 to 98.15 because of debt services, namely the issuing of a bond. She said she prepared the revenues with that 1.8 mill increase.
The district is the eighth lowest in the county for millage rates, but ranks as the fifth poorest school district by aid ratio in the county, she said.
“You’re doing extremely well as far as how you’re budgeting and supporting your programs because, according to the state, based on your free and reduced lunch and your demographic information around the surrounding area, United’s value as far as how they value it is pretty low … but your millage rate is remaining fairly low compared to some of the other schools in the area, so that’s a very good statistic to know,” Tuccarello said.
Tuccarello said the referendum exceptions have been applied for but are still in the “pending review” stage from the Department of Education, and have not yet been approved in order to allow the district to raise taxes beyond its index without a referendum vote. Allowances are being made for United’s special education and retirement contribution expenses.
As of now, Tuccarello said it looks as though the district will get an exception for $200,000 for special education costs and $117,000 for retirement, if they are approved by the state. Between those two, that gives the district approximately an additional 6 mills above the index.
As far as state funding predictions, Tuccarello said the Basic Education Subsidy the district receives from the state represents about 73 percent of all of United’s state subsidy revenues it gets from the state.
According to Gov. Tom Corbett’s budget, she said, state funding for 2013-14 is “projected at the highest since the pre-stimulus dollars” going back to 2008-09.
Additionally, United’s transportation subsidy is about 7 percent of all of the district’s state revenues and is calculated based on the miles driven by buses and the number of days school is in session, Tuccarello said. United is reimbursed at roughly 60 percent of its transportation costs, which is slightly higher than the average statewide subsidy reimbursement of 50 percent.
Tuccarello also budgeted $1.6 million for tuition in outside programs such as alternative education centers and cyber-charter schools. The district budgeted roughly $700,000 last year “and we’re spending more than that,” Tuccarello said, adding that the state cut the charter school subsidy a few years ago.
Under the pupil personnel budget, which encompasses some special education, child accounting and other related services, Tuccarello budgeted an increase of $124,000 for the implementation of a special education classroom. She said she does not yet have an actual direction as to whether it will be an in-house program or an ARIN-run program, “but I wanted to play on the safe side, so I used an ARIN-run program because I believe those costs will be the highest.”
If it were to be an in-house program, all the needed supplies would total roughly $15,000, Tuccarello said, but she said she wanted to play it safe and use the ARIN numbers, which includes additional staff, to have “room to come down on.”
Following Tuccarello’s presentation, the board agreed to schedule a special work session starting at 6 p.m. March 26 to talk about the staffing and special education budgets. It also planned to have a work session on April 9, the day of the next regular meeting.
The board also spent some time discussing ideas on how to recruit students for and promote United’s cyber school, which currently has slots for four students. Several elementary and high school students in the district attend outside cyber-charter schools with United paying their enrollment.
“I would like to, as one person, say, what are we doing to recruit students to go to United’s cyber-charter school as opposed to some other one?” asked board President Don Davis. “Because the whole purpose of designing that, bringing that in was that we were to hopefully bring kids back to United.”
Davis said there are “a lot of advantages,” such as getting a United diploma and doing “a lot of things as United students that maybe they couldn’t do as PA Cyber-Charter” or other schools.
“Do people in the district even know about this? And if they do, and we’re recruiting them, why aren’t they coming?”
Some suggestions were putting information about the cyber-charter school on the district’s website, advertising it on a billboard on Route 56, sending out newsletters to residents, using a local Comcast channel and even using social media like Facebook and Twitter as vehicles.
Davis said he’d like to have “some sort of creative way” of letting people know.
Board member Norma Carpenter suggested having an open house for prospective cyber-charter school students.
“Why couldn’t you have some kind of reception (to let students know), ‘You (can) go to the prom or belong to the majorettes … maybe the traditional classroom isn’t what you’re looking for but being a part of a group and being a part of United is, and we can do this for you,’” Carpenter said. She suggested having the school’s ambassadors such as student council, organizations, coaches and advisers there to say “be a part of us.”
“United’s a good place to be a part of,” she said.
“I don’t want these things to die on the vine,” Davis said. “I want them to continue to grow and flourish.”
Board member Robert Lichtenfels referred to the cyber-charter schools as a business, “and I don’t think schools take it seriously.”
“These places are vying for your kids,” Lichtenfels said. “That’s $1.6 million right there. To me, that’s a business. … The people in this room need to say, ‘You know what, enough of that. We need to be proactive and do something.’”
Davis agreed with Lichtenfels.
“You said it best — it’s a market, it’s a business. People are competing for our students,” Davis said. “I just want to make sure that we’re competing just as hard.”