Springfield OKs 2.4 percent tax hike
SPRINGFIELD » Taxes are going up in the Springfield School District.
The Springfield School Board unanimously approved the final budget of $84.7 million – including a 2.4 percent increase in taxes – with almost no changes from the proposed document passed in May. The only alteration, noted by Executive Director Don Mooney, was approximately $50,000 in additional revenue resulting from Gov. Tom Wolf’s budget approved in late June.
The district brought its budget in at the 2.4 percent Act 1 index. The millage rate for the average home assessed at $146,820 is 32.9796 mills, or $4,842. That means another $113 for the average home owner. The projected Homestead Exclusion for eligible homeowners will remain almost steady as a $186 tax credit.
The small state revenue hike illustrates the challenges of mandated spending. While the commonwealth added millions of dollars to the total budget, the funding formula for how dollars are allotted to each district resulted in only modest increases for Springfield. Dollars will be added to basic education and special education. However, the total subsidies from the commonwealth have not kept pace with costs.
As an example, special education expenditures in 2014-15 were $9.7 million and subsidies totaled about $1.6 million. The 2018-19 projected special education cost are $12.2 million and subsidies are $1.7 million.
The PSERS (Pennsylvania Public School Employees’ Retirement System) costs continue to be the most challenging budget issue. Mooney said the annual percentage increase is beginning to ease. Nevertheless, PSERS alone represents a $537,000 increase this year, with half being reimbursed by the state. The total PSERS cost to the district is $10.5 million of mandated expenses.
Mooney and his staff used the same format of a Power Point budget document. This year an additional page has been added entitled “Tax Increase from Master Plan Debt Service.” Understanding some of the public believes there will be a sharp spike in taxes as the $137 million (total project) high school master plan is rolled out, the page breaks down the annual tax increase and the specific dollar amount attributed to that debt service. For that same home and average assessed value, the total tax increase is $113, $41 of which is debt service. It is critical to note, bond funding in the current year was 9 percent of the overall budget, and is 10 percent in the coming year.
“We started five or six years ago to increase the millage gradually and evenly at the index to a level which enables us to pay the debt service,” said Mooney. “It’s the only way to plan for a capital project this size.” As a random scenario, he added, “There will never be a 15 percent increase because it is not allowed by law under Act 1.” (Any increase over the index would go before voters as a referendum, which has never been done.)
The district will be constructing a new, 21st century high school in the next several years, yet the enterprise, as some school directors call operations, continues to be people driven. Wages and benefits expenditures are 53 percent, about $53 million (including the employer PSERS contribution). With no outlook on a legislative solution by the commonwealth on funding education by alternate means, $57 million are property taxes paid by Springfield and Morton residents.