Derry Area School District property taxes will increase this coming school year.
At Thursday’s regular meeting, the Derry Area School Board adopted the district’s final 2020-21 budget, which includes a 2-mill hike in property taxes. The budget vote and a separate vote to raise the millage rate were each approved in a 6-3 roll call vote, with Kevin Liberoni, Mark Maloy and Sean Kemmerer casting the dissenting votes.
This 2020-21 increase will raise the tax rate to 91.8 mills. The school board last spring approved a final budget with a 2-mill increase in property taxes. Before that, the board moved forward with a 5-mill tax increase in 2018-19, a 2.8-mill increase in 2017-18 and a 2.5-mill bump in 2016-17.
Each mill is projected to generate $135,258 in 2020-21, compared to $135,318 for the current fiscal school year. A 2-mill increase would cost the average residential taxpayer within the district an additional $24.58 in new taxes.
“One of the driving forces, as we’ve talked many times before, has been our special education costs, our cyber charter school costs, our retirement costs, transportation costs,” Derry Area Administrative Assistant for Business Affairs Joe Koluder said of the tax hike.
The ongoing coronavirus pandemic, Koluder said, played a massive role in budget estimates tied to local tax revenue and related items.
“Our items that are driving this budget, we had to cut back our estimates on local revenues this year because we believe our local property tax collections will go down, and our income tax collections will go down,” he said. “We’ve reduced those based upon an estimate at this time; we’re not sure how much it is going to go down, but fortunately this year, our budget is being propped up two two federal subsidies we’re getting. Those are one-year monies — hopefully by next year, the issues with COVID are taken care of and we have a vaccine, hopefully our economy is back together and hopefully our local taxes are coming back.
“I’ll be honest with you; there are a lot of unanswered questions. This is one of the hardest budgets we’ve had to work with because there are so many unknown things. We know what’s coming from the state (budget), but we don’t know the local (revenue). And we aren’t sure what our actual costs are because we’re trying to open up our schools — there are costs that we are going to incur this year that we haven’t thought about yet — but unfortunately that’s where we are.”
Because of the coronavirus pandemic, the district is projected to nearly double the amount of federal funding it receives 2020-21 compared to the current fiscal school year — $1.48 million compared to just over $780,000 in 2019-20. Derry Area’s final budget also calls for $20.38 million in funding from state sources for the 2020-21 school year, a decrease of $98,915. Basic education and special education are the two main subsidies the district receives from the state.
The final budget shows $38.39 million in expenditures, up from $37.6 million in 2019-20. Listed expenditures include $22 million for salaries and benefits, $5.4 million for special education, $2.3 million for transportation, $1 million for plant operations and $2.7 million for debt service, along with the fund balance.
The spending plan also calls for a $98,074 decrease, or a drop of 0.4%, in salaries and benefits for the upcoming school year. The budget also includes additional spending in special education (an increase of $295,225) and transportation ($76,480), along with a small hike in plant operations ($3,665). The district’s debt service is projected to be $63,500 less, totaling just over $2.75 million, compared to the current fiscal school year.
The district’s fund balance is projected to be just over $4.6 million for the upcoming school year, a total that represents an 11.6% increase compared to 2019-20. The fund balance includes items such as budgetary reserve, textbooks, cyber/charter school funding, equipment, repairs, capital improvements, supplies, fees, contracted services and professional services.
The final millage rate represents a change from the spending plan Koluder presented to school directors in April, which called for a 3-mill tax increase.
According to budget figures, the district was able to chop a mill from initial spending projections by making $258,939 in reductions, which included salary cuts to principals at the district’s three buildings. Additional savings were made by making cuts in the following departments: EWAVTS ($119,962), special education salary/benefits ($99,727), summer/special ($11,640) and athletic director ($9,690), respectively.
“It’s nice to drop a mill off of it,” school board president David Krinock said.
Thursday’s final spending plan includes several changes from the tentative budget, Koluder said. Several of those adjustments include enrollment changes pertaining to special education and other student support services. The revised budget also includes an accounting adjustment where funds will be designated to proper accounts, he noted.
“We’ve had special education students or other students move out of the district, be brought back into the district, or graduate,” he said. “We adjusted our budget to reflect that.”
For 2020-21, Koluder said another $1.56 million must be used from the fund balance to ensure a balanced budget. That total includes just under $960,500 in unassigned fund balance and additional $600,000 allotted for a jump in retirement costs, the latter of which is projected to rise from a rate of 34.2% to 34.5%.
To cut costs over the past decade, the district has eliminated staff through attrition without eliminating programs. According to district figures, Derry Area will have eliminated 31.5 teaching positions and three administrative positions between the 2010-11 and 2020-21 school years.
According to the final budget, the district plans for the retirement of five teachers and the elimination of five teaching positions in 2020-21. Additionally, the district is not expected to replace a retiring maintenance supervisor while it plans to replace one of two retiring custodians along with a retiring maintenance employee.
In November, the school board approved a resolution to operate within the Act 1 index during the 2020-21 budget cycle. The cost-of-living index caps any property tax increase at 3.6%, or 3.23 mills, Koluder said previously.
In other business, superintendent Eric Curry outlined an initial reopening plan for the school district this fall. Curry’s presentation covered 10 areas of focus to keep students and staff members safe in light of the pandemic, including items related to: cleaning, sanitizing and disinfecting; social distancing; learner and staff health; training for understanding and compliance; learning models; brick and mortar; remote learning; hybrid model; transportation, and examples of temporary exclusions.
“We’re hoping for the best, but we’re preparing for the worst,” he said.
The reopening plan includes a baseline for guidelines related to holding classes while ensuring social distancing, transportation measures aimed at providing the same level of protection as in classes, and education options that may include in-person learning, remote learning and a weekly “hybrid” mix that combines both remote and in-person learning.
Curry said any reopening plans are fluid based on new information coming from state health officials. The district’s goal is to unveil its final reopening plans at a work session meeting slated for July 30.
Following Thursday’s presentation, Curry read a letter addressed to district parents. The letter will be mailed to parents and will be available for viewing on the district website.
Krinock praised school officials, including Curry, for laying out reopening plans in a patient, measured matter.
“Eric has a unique way of waiting,” he said. “We don’t have to be first. We think we have time. I’d love to be able to open up (this school year).”
In other business, the board approved:
- Resignation of Robin Hoone as a noon time cafeteria aide at Grandview Elementary School, effective June 7;
- Resignation of Brian Clawson as class advisor, effective at the end of the 2019-20 school year;
- Resignation of John Balega as a substitute custodian, because of retirement, effective Sept. 1;
- Resignation of Cheryl Benson as secretary to the food service director, because of retirement, effective Dec. 31;
- Resignation of Michele Macey as high school guidance secretary, because of retirement, effective Oct. 30;
- A change in status for Robert Dunlap from a seven-hour high school afternoon custodian to an eight-hour daylight cafeteria custodian, effective June 29;
- A change in status for Colleen Chamberlain from an eight-hour middle school afternoon custodian to an eight-hour middle school afternoon lead custodian, effective June 29;
- A change in status for Jason Gundaker from an eight-hour high school gym custodian to an eight-hour high school pool midnight custodian, effective June 29;
- Athletic health and safety plan to student-athletes to return to voluntary workouts beginning Monday, June 29, and for the administration to adapt the plan as new information and requirements are made available. The 13-page plan for offseason workouts will be made available on the district website;
- T.J. Balega, Levi Humberger and Josh Flack as volunteer football coaches for the 2020-21 school year;
- Homestead/Farmstead resolution ($198.42 Homestead/Farmstead credit);
- Tuition agreements with New Story School for the 2020 extended school year;
- A $64,215 bid for severs, storage and installation to CCL Technologies using capital reserve funds;
- Revised panel of physicians;
- Transfer of $6,000 from the school district to the Derry Area School District Foundation for the capital campaign feasibility study.