Districts finalize tax bills

Districts finalize tax bills

By: JOAN HELLYER
Bucks County Courier Times
2010-2011 budget analysis

Some area school boards are stockpiling district savings by the millions to avoid significant tax increases in the future.

Average increases on local property tax bills in 2010-11 will range from $0 in the Morrisville and Neshaminy school districts to $295 in Bristol, according to budgets recently adopted by area school boards.

The tax bills began being mailed Thursday, the first day of the new fiscal year for school districts.

The unstable economy and expected increases to the state's employee retirement fund in coming years were major factors in shaping the budgets, school board members said.

Tough economic times forced the Bensalem, Bristol, Bristol Township, Centennial and Pennsbury school systems to make staff reductions to help balance the spending plans. The cuts include a variety of teaching, administrative and support positions and range from $250,000 in Bristol to an estimated $2 million in Bensalem.

Bucks County Technical High School, which serves the Bensalem, Bristol, Bristol Township, Morrisville, Neshaminy and Pennsbury school districts, also was forced to reduce its workforce by about $1.3 million. The reductions include two teachers, five academic coaches and eight other support staff positions.

The cuts were made as school boards tried to save up for Public School Employee Retirement System rate spikes ranging between 16 percent and 35 percent. The PSER rates are expected to increase between 2012 and 2016.

"We're all struggling to figure out how we can plan for it in the long run," said Isabel Miller, Pennsbury's business administrator.

Area districts, including Bensalem and Bristol Township, have, for the last couple of years, tried to prepare by making moderate tax hikes to avoid using millions of dollars in their districts' savings accounts.

The increases are within the index allowed by the state's Special Session Act 1 of 2006, the Taxpayer Relief Act. The stockpiled savings will be used to avoid excessive tax hikes in the next several years, officials said.

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Not everyone agrees with that approach.

"How much more can they keep taxing us before we are all out on the street?" said Fred Berger, a Bristol Township senior citizen.

A district's index is determined by averaging the statewide average weekly wage with employment cost index data from the Bureau of Labor Statistics, state officials said.

Most area districts were allowed to raise taxes in 2010-11 by 2.9 percent without the need for voter approval or the state's OK to cover certain expenses.

No district in Bucks County has had to go to referendum to ask for voter approval since Act 1 took effect, but that could change next year when most school system indexes are expected to drop below 2 percent, officials said.

Even with the restrictions, the tax increases being levied are still reducing the relief property owners were supposed to receive from state gaming credits, Berger said. The annual homestead exemptions are provided for by Act 1 for qualified property owners.

The 2010-11 credits range from $279 in the Council Rock School District to $171 in the Centennial School District. Districts apply the credit to a property owner's tax bill using casino funds distributed by the state. Berger, whose property value is greater than Bristol Township's average assessed property of $16,000, expects he'll realize very little in savings on his tax bill once the credit is factored in.

"It's supposed to save us some money, but it's never there. We're not getting any (significant) benefit from it," said Berger, a 40-year district resident. He expects to see an estimated $100 in savings once the gaming credit is factored into his tax bill.

Other districts in Bucks seeking higher taxes.

From the BCCT:

Most districts seeking higher tax rates
By: JOAN HELLYER
Bucks County Courier Times
The projected average tax increases range from $108 in Morrisville to $464 in Bristol.

Six out of the eight school districts in Lower Bucks County plan to ask the state for permission to raise taxes in the coming school year beyond what is allowable under the state's property tax relief law.

The Morrisville and Pennsbury school boards were the only governing bodies in Lower Bucks to pledge to keep any tax increase for 2010-11 within the assigned index rate. That amounts to a 3.4 percent increase of Morrisville's current tax rate and a 2.9 percent increase of Pennsbury's millage rate.

School boards throughout Pennsylvania that planned to not raise taxes beyond their index rate had until Thursday to pass a resolution stating their intentions, as per the property tax relief law known as Act 1. A district's index is determined by averaging employment cost index data from the Bureau of Labor Statistics with the statewide average weekly wage.

Most districts, however, have indicated that remaining below their designated index rate would not be possible, given the current economic climate.

The school boards will ask the state's permission to increase their respective tax rates even further to cover various exceptions. They include special expense costs, debt service payments and the estimated 4 percent increase in retirement contributions.

The average tax increases are expected to range from $108 in Morrisville to $464 in Bristol, according to initial projections.

Council Rock, with a possible 7.4 mill increase, finds itself in the middle of the pack with an estimated $280 property tax increase.

"While we place that in front of the board to begin the Act 1 process, it is not a budget that is acceptable to anyone in the Council Rock School District," Superintendent Mark Klein said. District administrators will work over the next few weeks "to significantly reduce that budget and millage increase," he said.

The budget process is in constant motion between now and June, when school boards adopt final budgets. Many variables have to be considered, figured and reconfigured, officials said.

For instance, in Bensalem, the school board had planned to use $2 million in reserve funds to cover expenses during the current school year. But thanks to several cost-cutting measures, including several delayed hires, the reserve funds will not be needed during 2009-10, said Jack Myers, Bensalem's director of business operations.

The Bensalem board might opt to use some or all of those funds to help balance the 2010-11 budget, Myers said.

The six Lower Bucks school boards that did not promise to keep tax increases below their respective index rate now have until mid-February to adopt a preliminary budget that could include the requested exceptions.

All school boards in the state have until June 30 to adopt a final budget for the following school year.