The Bermudian Springs school board contemplated a tax increase and announced it is cutting out its monthly caucus meetings during meetings this week.
The board held a caucus meeting on Monday and a regular board meeting on Tuesday.
At the end of Tuesday’s meeting, board president Daniel Chubb announced that the board will no longer hold monthly caucus meetings. Instead, the board will hold only its regular monthly voting meetings.
Chubb said that because the school board began creating more committees in the past several months for topics including curriculum and instruction and policy reviews, there is no longer a need to hold a caucus meeting.
The board has historically held only one meeting per month in the summertime but both caucus and regular meetings during the school year.
2025-26 budget, possible tax hike
The board moved forward with its Fiscal Year 2025-26 budget using a 5.4% placeholder tax increase.
As it develops its budget for FY 2025-26, the board must stay under the Act One Index, the maximum allowable tax increase, which is 5.4% this year for Bermudian Springs.
The Act One Index is set by the state each year and then adjusted by school district so that the maximum amount changes annually.
Despite taking cost-saving measures, the district is still facing a potential significant deficit in its fund balance even if the district goes for the full Act One Index.
Justin Peart, business manager for the school district, provided the board with an update on Monday evening.
The beginning fund balance for the 2024-25 school year was $6,543,678. In March, the district was able to add a total of $55,709. Now, the estimated fund balance for June 30, 2025 is $6,599,387.
Should the school board vote to approve a tax increase at the Act One Index, the 2025-26 fund balance is still projected to drop to $5,422,627 by June 30, 2026.
A three-year projection created by Peart shows a possible future if the board does go to the Act One Index, with the FY 2026-27 fund balance ending with $2,989,817, the FY 2027-28 fund balance ending at -$757,380, and the 2028-29 fund balance ending at -$5,999,686.
Projections that include less income because they have no tax increase, or a tax increase below the Act One Index, show more dire possible outcomes with even more significant shortfalls in the budget.
Still, Peart said that while the board needs to consider its actions now, projections – especially those years out – are not certain.
The district has taken a variety of cost-saving measures.
One upcoming change includes switching its device procurement to a leasing option through Apple.
Superintendent Brad Sterner said he and Peart looked at the district’s devices and realized the oldest ones are 15 years old and are actively used by students and/or employees.
“Obviously, different operating systems take different pieces or equipment to update them, and I can tell you our oldest iPads that we currently have are no longer able to be updated,” Sterner said. “Their shelf life is gone. So what we have done in the past is we worked through a refresh cycle as a school district and that refresh cycle kind of got interrupted during COVID just with funding and so forth, which it did in a lot of school districts.”
The district found that it could standardize and update its devices while saving money by leasing them through Apple with a 0% interest plan. The most recent purchases will be sent to the elementary schools while devices in other schools will be switched to the new leased products. The oldest ones will be sold, with the money going towards the cost of leasing new equipment.
Sterner said the switch will save at least $50,000.
Peart did add a recent positive change of $301,503, achieved through a mixture of reduced expenditures and increased revenues. That included staff who announced retirements (decreased expenses of $44,524) and a positive change to the retirement reimbursement (increased revenue of $259,979.)
Peart said the budget presented in Monday’s meeting did not include the money that will be saved by leasing Apple products, but those figures will be updated for the May meeting.
He showed the board fund balance projections from before the $301,503 was added and after. While the projected deficits still exist, they did decrease.
“I always say and I will continue: once you get out to the third year there’s a lot of assumptions that are playing on,” Peart said. “A lot of things can change. But obviously, these numbers have, as we’ve worked from January until now, these numbers have definitely improved. That’s what we want to see. I can’t always guarantee that that’s going to happen, but I’m going to actually love it every time it does.”
Peart warned that the board had to decide whether to proceed with the preliminary budget set at the 5.4% increase as a placeholder or use a lower rate. Once set, the board could only use a lowered rate from there for the final budget. For example, if the board set a 3% rate in its preliminary budget, the final budget could only include an increase of 3% or lower.
After a debate, the board decided to move forward with the 5.4% Act One Index set as its ceiling to allow for greater flexibility when the time comes to approve the final budget.
The decision does not automatically mean there will be a tax rate increase. It simply sets the maximum the board can raise taxes. The final vote on a tax increase will take place when the board votes on the final 2025-26 budget in June.
Board treasurer Ruth Griffie worried that residents will assume the 5.4% rate is final.
“Then the people are going to sit here for another month and worry about what we’re going to vote for,” Griffie said. “I would prefer it to be lower than that. I would prefer it to be at least the 3.6% because I don’t want my people sitting out there thinking that we could go to 5.4%.”
Chubb encouraged Griffie to explain the budget process to her constituents so they understood that the rate is not yet final.
Board secretary Jennifer Goldhahn expressed regret at having to make a decision regarding taxes.
“You know, we understand that there are seniors out there who have to make the decision between medications,” Goldhahn said. “Their taxes are going up. There’s a whole bunch of things. The source of this problem is funding in public education. Per law, by the constitution of Pennsylvania constitution, we are supposed to be funded at 50%. We are currently funded at 38-40%.”
Board member Matthew Nelson suggested that the board develop four-year plans and explain them to residents in the area.
“If you guys could talk with your voters and other people in the community about what your plan is for the next four years, you have an opportunity to control the budget for the next four years,” Nelson said. “So if we do Act One (Index) this year, that’d be $800,000 for the next four years that we get. And then what you could talk about then is, if we did Act One (Index) this year, then maybe in the next four years there could be a year where 0% is on the table. Then that way you can balance it then, too. But explain to people that this year we’re going to hit you with a bump but it’s going to make the district $800,000.”
Nelson said Peart’s budget presentations also show that while a tax increase isn’t attractive, even a 5.4% increase isn’t necessarily prohibitively steep, especially if the board limits future increases.
“That’s one of the reasons Justin’s slide is so nice,” Nelson said. “We have to be beholden to the taxpayers, too, and understand that they have limited income – but that’s one of the reasons why that slide is so good. It is $12. So, I don’t want to pick apart. I know everyone needs every dollar they get. But for asking the people in our community for $12 that gets us $800,000 for the next four years, or actually, forever, compounding $800,000 all the time.”
The board held executive sessions before and after the caucus meeting on Tuesday.
The board will hold a special meeting at 5:30 p.m. Thursday, April 17 to vote on the collective bargaining agreement.
Its next regular meeting is scheduled for 7 p.m. Tuesday, May 13.
Imari Scarbrough is a freelance journalist. She was a staff newspaper reporter for five years before becoming a freelancer in 2017. She has written on crime, environmental issues, severe weather events, local and regional government and more.
You can visit her website at ImariJournal.com.