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School Taxes Could Jump Above Act 1 Index

The Bensalem Township School District is aiming for a 3.2 percent tax increase as part of next year’s school budget.

The Bensalem Township School District is aiming for a 3.2 percent tax increase as part of next year’s school budget.
The Bensalem Township School District is aiming for a 3.2 percent tax increase as part of next year’s school budget.

Bensalem property owners will pay more in real estate taxes in the coming school year under the district’s preliminary $133.5 million budget. 

As projected in the Bensalem Township School District’s preliminary spending plan outlined in a power point presentation Wednesday, school district taxes could rise by 3.2 percent–roughly 1.5 times the increase amount permitted under the state’s Act 1, according to Kenneth Medina, the district’s director of business operations.

For the owner of a home with an average assessed value of $21,000, that translates to $97 more per year in taxes for 2014-2015 as compared to currently, Medina said.

The tax levy amounts are not set in stone, Medina said. However, he said the school board is on track to authorize approval of application for three special exceptions that would permit the district to raise taxes beyond the 2.1 percent tax increase allowed under the state’s Act 1 Taxpayer Relief Act.

Factors warranting special exception tax increases

Medina said the district’s required 21 percent increase in the Public School Employees' Retirement System is the main driver in raising taxes beyond the threshold. The district intends to seek permission to raise $1.1 million more in taxes to help cover that expense. An amount has not been set for the special education exception. The other exception, in the amount of $1.3 million, would be used for “grandfathered” debt expenses, which Medina said would cover debt service for the district’s yet-to-be-started $78 million Bensalem High School renovation and expansion project

He had told Patch previously that taxes would not be raised beyond the Act 1 threshold to cover the project, but said Thursday that that is now necessary. 

Increased expenditures totaling $4 million–including $2.2 million more for the retirement system increase–warrants the need to apply for a special exception, he said.

Other factors include escalating medical insurance costs, which he said are projected to be 12 to 14 percent higher next year and cost an additional $1.7 million. 

In all, the preliminary budget, as proposed, is $4.16 million higher year over year.

The district will use “some” of its roughly $9 million from its undesignated fund balance to help offset shortfalls or tax increases, he said. The district tries to keep 4 to 6 percent in that account he said, noting that 5.05 percent is currently in the account.

The board “wants to be careful that they don’t use up all the available fund balances,” Medina said. “They won’t have any wiggle room or any fallback position in future years.” 

Next steps

Following Wednesday’s first budget work session, the board is expected to adopt its preliminary budget on Jan. 22 and authorize request for the special exceptions needed to raise taxes beyond the 2.1 percent cap.

In the meantime, Medina said the district must cut back on some of its cost centers by at least 5 percent. Doing so will trim the roughly $1 million needed to balance the budget with the exceptions figured in.

The district will also work to align its programs with its recently approved comprehensive plan, he said, adding that “funding educational initiatives” is a priority.

The board’s instructional affairs committee approved courses for next year, he said. Those would be scheduled and the community would know which courses would be available within the next six to 12 weeks, he said. 

Part of the course offering process is “aligning our resources to match that comprehensive plan as much as affordable,” he said.

Those resources are teachers and the district does not know how many will retire at the end of the year. Options could include reductions in staffing through attrition. Teacher furloughs are not under consideration at the moment, he said.

However, “nothing is off the table,” Medina said.

Finalizing the budget

Besides the preliminary adoption later this month, the board is expected to adopt its proposed final budget on May 14 and its final budget on June 18.

Between now and then, Medina said the district welcomes community input, particularly at committee meetings.

“We do serve our public,” Medina said. “The budget’s not just about numbers, it’s about supporting education as warranted.”

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james bailey March 28, 2014 at 01:54 PM
This is why HB/SB76 is so important. We need a change in all government positions. Remember voting time out with the old and in with the new. Current politicians are all for the school unions. Let's get them out of office before we are all broke and homeless
Vic Monaco March 28, 2014 at 01:56 PM
The district is indeed making it very difficult for many folks to stay here.
james bailey March 28, 2014 at 02:01 PM
Time to get rid of the bad seeds in office and I mean a total sweep from the top on down
P2YA March 28, 2014 at 09:57 PM
Hierarchy of Bensalem is totally pro-union, so I imagine the high school renovation is a union job top to bottom. That could be what accounts for a higher cost, probably at least 20%.
Believe March 31, 2014 at 01:02 PM
Also check out what the Boyertown School District in Berks County is doing for less money. So many of these schools seem to have similar plans at 1/3 to 1/2 less than what Bensalem is going to spend. Also, the price could increase from what they are quoting, has happened to other schools.

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