State College School Board Approves 2022-23 Budget, Tax Increase

The State College Area School Board voted unanimously on Monday night to approve a final 2022-23 budget that includes the district’s first real estate tax increase since 2019.

The tax increase of 3.4% is the district maximum under the Act 1 Index and bring the district’s tax rate to 47.6544 mills. The average residential property owner will see a $128 tax increase, offset by a a $28 homestead exclusion increase, for an annual bill of $3,323.

Anticipated revenues in the budget total $177,037,552, a 5%increase over the last year. Expenditures total at $180,273,275, an 8% increase. General fund balance committed to the anticipated shortfall will be used to absorb the difference.

The ending unassigned general fund balance would be $14,277,458, which at 7.9% of the budget is within the 8% ceiling.

Salaries and benefits comprise about 74% of expenses, followed by capital-related transfers (10%), services, (7%) supplies and equipment (5%), charter schools (3%) and other transfers and fees (1%).

Recurring additions to the budget include increases of four full-time equivalent (FTE) teachers related to enrollment needs: one middle school teacher, increases of .5 and .34 for middle school art and music teachers and .6 gifted support teacher. It also includes one special education teacher offset by a reduction of three paraprofessionals and four .5 FTE Virtual Academy teachers, offset by a reduction in supplemental payments.

Other recurring additions include allotments for staffing for recruitment and Title IX compliance, contracted mental health services and an HVAC technician.

Non-recurring additions include a middle school science teacher position for one year, cybersecurity equipment and expenses for lost learning funded by federal grant money.

As is past years, a large majority of the budget revenue — 79% —comes from local tax revenue, with the vast majority from real estate-related taxes. Another 19% comes from state sources and 2% from federal sources.

Since last year, district administrators have projected that, largely because of uncertainty in the economy, expenses would begin to outpace revenues. Current projections show the deficit leading to a negative fund balance as early as 2028-29.

“This will be a subject for us for the next coming years to correct this,” Randy Brown, finance and operations officer, said in early May. “We do see some signs for additional revenue correction in some of our areas which will help if that comes true to correct this curve in at least a portion, if not entirely.”

Concurrent with the final budget, the school board also passed the Homestead and Farmstead Exclusion and Supplemental Property Tax Rebate resolutions for 2022-23

An assessed value reduction of up to $2,877 will be provided for all eligible homestead and farmstead properties, resulting in a $137.10 reduction in real estate taxes to be paid.

Under the supplemental property tax rebate, property owners with income below $35,000 will receive maximum rebates between $250 and $650.

School Lunch Rates

With the U.S. Department of Agriculture apparently discontinuing funding for free meals, elementary, middle and high school lunches will cost the same as in 2020, the last time schools charged for meals.

Elementary lunch: $2.70
Middle school lunch: $2.95
High school lunch:  $3.50

Elementary and middle school breakfast prices from 2020 will increase by 5 cents to $1.50, and high school breakfasts increase by 30 cents more to $2.25. The price of milk will remain 65 cents.