Draft budget shows $ 1.7M deficit

ROYERSFORD » The months- long school budget process kicked off Nov. 23 with a broad brush look at a $ 182.3 million spending plan for the coming year, which is about $ 10.2 million more in spending than the current year.

James Fink, chief financial officer for the SpringFord Area School District, said making budget forecasts is difficult because we are only four months into the current fiscal year and two months into the school year, compounded by the unknown impacts the COVID- 19 epidemic is having on the economy and costs.

As it stands now, the forecast is for a $ 7.5 million deficit between spending, which he said will increase by about 6 percent and revenues that are expected to rise only 1.7 percent.

Despite these many unknowns, Fink said what is known is that personnel costs, which comprise 70 percent of budget expenses, are likely to increase by about 5 percent, driven largely by contractual pay raises.

Current estimates also see an 8.6 percent hike in state retirement costs and a 5 percent increase in medical and dental insurance costs.

The budget draft indicates using $ 300,000 from reserves to help close that deficit, along with a property tax hike of 1.5 percent to generate $ 1.65 million in additional revenues.

Many things will change in this draft as the current year unfolds and the picture of revenues and expenses clarifies.

The board is scheduled to vote on this preliminary budget in January, but nothing becomes final until a final vote on a final budget, not due to take place until May.

This article first appeared as a post in The Digital Notebook blog.