Board agrees on top tax increase

The maximum that Mt. Lebanon School District property taxes would rise for 2015-16 is 0.42 mills, according to a consensus of school board members.

They addressed the coming year’s budget during their discussion meeting Tuesday, with the agreement that an increase would not exceed the amount of revenue needed to meet the district’s mandatory contribution to the state Public School Employees Retirement System.

Board members also agreed to use at least $750,000 of the district’s unreserved fund balance to help meet expenses.

That amount plus the revenue that a 0.42-mill increase would bring in would leave the district with a gap of about $582,000 to be made up in spending cuts to balance the budget, according to Lawrence Lebowitz, school board president.

He cautioned that there are “very, very few easy cuts. There is no fat in this budget.”

The board plans to vote Monday on the $90 millionplus preliminary budget and further discuss it May 11. Adoption of a final budget is targeted for May 18. The amount of the tax increase could change by then.

As board members discussed the budget, most board members said they would prefer a smaller increase. Dan Remely suggested a 0.25-mill increase.

Increasing taxes by 0.25 mills would require an additional $475,000 in spending cuts, according to Janice Klein, district director of business. An increase of 0.42 mills would mean the owner of a home with an assessed value of $200,000 would pay $84 more in school property taxes next year.

Mr. Remely said he also would favor using an additional $850,000 from the fund balance to help reduce the tax burden.

The board’s policy calls for the fund balance to be the equivalent of at least 6 percent of budgeted expenditures, a measure aimed at helping the district maintain a favorable bond rating, which could result in lower interest rates for issuing or refinancing bonds.

Several board members Tuesday cited issues at the state level that they said create financial hardships for school districts.

Employer contributions toward PSERS, for example, have skyrocketed in the past several years as the state scrambles to make up for an unfunded liability of more than $30 billion in the fund.

Meanwhile, the state has not paid the amount it said it would pay to the district under Plan-Con — Planning and Construction Workbook — a reimbursement system for school districts that undertake renovation and construction projects.

Also, the amount of state funding for school districts is unknown until the Legislature adopts Pennsylvania’s 2015-16 budget. That could extend past the June 30 deadline, which is after the Mt. Lebanon school board plans to adopt the district budget.

“Because of what has happened in state government, we’re all paying for that now,” board member Michael Riemer said.