Connellsville Area School District officials have a month to balance a 2023-24 budget that now reflects a $3.2 million deficit.
At a meeting Wednesday, the school board unanimously approved a proposed final budget that lists revenue at $82,097,534 and expenditures at $85,360,209.
Under state law, a proposed final budget has to be in place by May 31.
It will be available for public review on the district website and in the administration building until June 28, the date set for adoption of a final budget.
Projected revenue will decrease 3.19%, and expenditures will increase 2.88%.compared with the current budget.
Business Manager Cherie Routzahn emphasized the plan approved Wednesday is not the final budget.
“We will continue to go through the budget line by line to look for variances and any potential savings,” she said.
The proposed final budget does not factor in the effects of a real-estate tax increase, Routzahn said during a budget update.
However, she recommends the board boost the real-estate tax rate by the maximum amount – 5.9% or 0.8406 mills — allowed under a state-set index.
The proposed full increase would boost the tax rate from 14.2481 mills to 15.0887 mills.
That increase would generate $807,639, which would reduce the deficit reflected in the proposed final budget by about one-fourth.
During the update, Routzahn provided the effects of the 5.9% increase on various property assessments and tax bills.
The owner of property assessed at the district median value of $60,000 would see his or her real estate tax bill increase $50.44 from $854.89 to $905.32. It would amount to $4.30 a month.
For a property assessed at $100,000, the tax bill would increase $84.06 from $1,424.91 to $1,508.87.
The 14.2481-mill tax rate has been in place since the 2015-16 school year.
It is the lowest tax rate among Fayette County public school districts and would remain the lowest if an 0.8406-mill increase is approved.
For the 2022-23 school year, the Albert Gallatin tax rate is 15.5902 mills; Uniontown Area, 16.640; Brownsville Area, 19.430; Laurel Highlands, 19.3034; and Frazier, 21.0098.
In the last decade, Connellsville Area has increased millage twice, in the 2014-15 and 2015-16 school years.
Over that time, Albert Gallatin and Uniontown Area have each increased millage three times; Laurel Highlands and Brownsville Area, five times each; and Frazier, eight times.
State median household income – based on a five-year average — is $67,587.
The median household income in the Connellsville Area School District is $52,366, Routzahn said.
Median household income in Laurel Highlands, Uniontown Area and Brownsville Area are all lower, but millage in those districts has increased more times than Connellsville Area over the past decade.
Connellsville Area relies heavily upon the state for revenue. It receives 67% of revenue from the state, 25% from local taxes; and 8% from federal sources.
The district might receive help with the deficit from the state if Gov. Josh Shapiro gets all he asked for in his proposed budget. Routzahn said that information might not be available until June or July.
She took a conservative approach in projecting state subsidies, estimating less than Shapiro has requested.
As a service-related entity, the district’s greatest expenditures are salaries — 36% — and benefits- 25%.
Salaries have been “rolled over on actual agreements with he groups that have a contract,” it was noted during the presentation.
The district must soon negotiate a contract with the Connellsville Area Education Association, which represents teachers.
The teachers’ bid meeting- which traditionally results in movement in positions — is scheduled today.
Routzahn said the result of that meeting will allow the district to adjust staff to proper budget codes, evaluate open positions and budget for open positions.
Purchased services, including transportation and cyber/charter schools, is 24%. Debt is 10%; supplies and utilities, 4%; and property and equipment, 1%.
Routzahn said a large percentage of expenditures are based on contracts and state-mandates costs.
Special education costs have steadily increased over the years.
In the 2018-19 school year, the cost was $10,104,160; 2021-22, $12,167,478; 2022-23, $13,465.843 (budgeted); and 2023-24, $15,142,052 (budgeted).
The same is true for cyber/charter school tuition, which continues to rise and is costly compared with district educational cost per student.
Connellsville Area’s in-house Falcon Online Learning Academy provides an alternative for district students opting out of traditional classroom settings.
The district saves money when students choose FOLA over outside cyber/charter schools.
Routzahn said utility costs continue to be up, and health insurance will be more expensive. Medical insurance will rise 14% and vision and dental insurance 3% each.
The proposed final budget includes $500,000 for unexpected increases in wages, ESSER costs not specifically budgeted, other grant-related costs and other unexpected costs.
Another $500,000 was transferred to the capital projects fund.
The COVID-19 pandemic led to large pools of one-time federal revenue through the Elementary and Secondary School Emergency Relief Fund.
That source was used to prop up budgets and help maintain the district fund balance since the 2021-22 school year.
With the ESSER money gone during the 2024-25 school year — and without increasing revenue or reducing expenditures — the fund balances is expected to drop by more than half to $8,563,707.
Under those same conditions, the fund balance is projected to be at minus-$2,276,696. During the 2025-26 school year.
