Property owners within the State College Area School District can expect a real estate tax increase for the second consecutive year.
The State College Area School Board on Monday approved a proposed 2023-24 budget that includes a 4.1% tax increase. The increase, which is the maximum allowed , would bring the millage rate to 49.6082.
For the average residential property owner, the annual school tax would be $3,430, a $141 increase from 2022-2023. Residential parcels constitute 83% of taxable properties in the district. Commercial and industrial properties would see an average tax of $26943, a $1,105, and the average agricultural property tax would be $4,770, a $196 increase.
After keeping tax rates flat in 2020-21 and 2021-22 because of COVID-19 impacts on residents and businesses, SCASD raised taxes for 2022-23 by 3.1%, which was the maximum allowed last year without seeking an exception under Pennsylvania’s Act 1 Index. The 4.1% increase proposed for 2023-24 is the Act 1 maximum for this year.
“The proposed real estate tax rate… does reflect an increase of 4.1%, but I think it’s important to remember that the district did not raise the tax rate in 2020-21 or 2021-22,” board member Deborah Anderson said. We did raise taxes last year but if you look at the five-year average tax increase… it’s just 1.89%.
“So the 4.1% that we’re suggesting for this year is really trying to get us back to where we would have been — and it doesn’t quite get us there but close — if we had persisted with the 2% increase per year which has been our historical average. And remember we generally have to increase taxes every year because our costs go up every year. Seventy-one percent of our budget goes to salary and benefits, and we would expect those to go up every year because we want to pay our people accordingly.”
The proposed budget includes $187,132,736 in expenses, a 3.8% increase from 2022-23 and $188,350,588 in revenue, a 6.4% increase.
As is typical, salary and benefits make up the vast majority of expenses at 71% of the budget, followed by capital-related transfers (11%), supplies and equipment (6%), purchased property and other purchased services (5%), charter schools (4%), professional services (2%) and other transfers and fees (1%).
New recurring expenses that were previously grant-funded include two mental health clinicians, the Multicultural Student Success Initiative and partial funding for the family liaison/bilingual educator position. Those total $398,790.
Other recurring costs include a human resource software, girls wrestling program, investment in cyber security and inflation on products and services.
The large majority of the budget revenue — 80% —comes from local tax revenue. Another 19% comes from state sources and 1% from federal sources.
A budget hearing will be held on May 15 and the final budget will be presented for approval by the board on June 5.
