Facing $1.8M deficit, UASD weighs potential tax hike

Staring down a projected $1.8 million deficit for next school year, one Upper Adams School Board member predicted “serious trouble” ahead, should the district not increase taxes.

Upper Adams School District Business Administrator Shelley Hobbs presented a financial update to the school board Tuesday. Board member Chris Fee was absent.

Hobbs anticipates revenue for the 2023-2024 school year to be approximately $33.7 million, with expenses exceeding $35.5 million.

She said these numbers may change before June 30, the state deadline by which school districts must pass a budget. Hobbs said a preliminary budget needs to be adopted by May 16. The preliminary budget may be higher than the final budget adopted in June.

Approximately $1.3 million of the $1.8 million increase in expenses is due to salary and benefits costs, Hobbs wrote in an email Wednesday, plus transportation increases of about $185,000.

Additionally, district administrators have asked for about $187,000 to hire a secondary building substitute, secondary math professional, and elementary special education professional. Other asks include $20,000 for new band uniforms, and $235,000 for internet connectivity, cyber insurance and a firewall license renewal. These total $442,170.

To balance the 2023-2024 budget, the district may raise taxes, take money from its unassigned fund balance, or a combination of both, according to Hobbs. She estimated the district will have approximately $2.9 million in its unassigned fund balance as of June 30, 2023.

There is a limit to what the district can take from the unassigned balance. The fund must be between 1% and 8% of expenditures, Hobbs said.

The 2023-2024 budget is not the only budget the school board has to consider. Hobbs predicted the district will see a deficit of at least $1.8 million heading into the 2024-2025 school year, too.

“What we do this year may make the [fiscal year] ‘25 budget very difficult to balance,” Board Vice President Tom Wilson said.

Hobbs presented budget scenarios that included no tax increase and up to a 3% increase. A tax hike of 3% would generate $408,246 in additional revenue for the district, according to budget documents shared at the meeting. This would cost a homeowner an additional $87.12 annually for a home assessed at $185,750.

“This tells me the tax increase this year – based on everything that Shelley [Hobbs] said – including her assumptions, would be closer to 3, or maybe 3-and-a-half, 3 to 4% in order to get through next year,” Wilson said. “If we don’t do that, the board next year is going to have some trouble, some serious trouble.”

Board member Gerald Walmer, who serves as treasurer, described the $442,170 in “brand new asks” as “substantial.”

Wilson asked Walmer what expenses he would eliminate. Walmer said he wants the band to have new uniforms, but he did not say which expense requests he would cut.

“It’s a lot of money to ask the taxpayers, the district, to foot,” Walmer said. “They’re not going to be able to go to their boss and demand additional money.” 

Board member Cindy Janczyk said while she sees the “justification” for additional educators, “… we’re asking taxpayers to pay for positions that we don’t have yet, so we wouldn’t have to cut them.”

Eliminating the requested educator positions would still leave the district with a deficit of around $1.6 million.

“It would seem to me that, as a school board, we need to decide whether we’re going to support the hiring of needed education people or not,” Wilson said.

The last tax increase in Upper Adams School District was two years ago, Hobbs said.

In other business Tuesday:

  • Student lunch debt remains high. Wilson said the debt has increased 200% in one year. Hobbs said efforts continue to be made to try to reach families who owe. Free and reduced cost lunches are available for eligible families.
  • The board approved base repair, crack sealing and seal coating at Biglerville Elementary School at a cost of approximately $122,600.
  • The new Biglerville High School greenhouse will be dedicated at 11 a.m. May 2 at 161 North Main Street, Biglerville.
  • Newly-appointed board member Kay Hollabaugh will chair the school board’s Student Activities Committee.

The Upper Adams School Board’s next general meeting will be May 16 at 7 p.m. Committee meetings will be held May 2 at 6:30 p.m. and May 4 at 9 a.m.

+ posts

Mary Grace Kauffman, freelance reporter, worked six years as a full-time reporter for newspapers in Pennsylvania and Maryland. She has covered topics including business, crime, education, government and features. Mary Grace has a bachelor's degree in communication/journalism from Shippensburg University. She resides in Adams County.

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments
>
0
Would love your thoughts, please comment.x
()
x