State education cuts forcing difficult decisions in many school districts

Citizens in Westmoreland County successfully fought off a proposed tax increase Thursday, winning a battle likely to be repeated across the state in the coming months.

A group of more than 50 angry citizens packed the Southmoreland School District’s school board hearing and convinced the board to remove proposed tax increases from the district’s preliminary budget, according to sources who attended the meeting. The school board was planning to apply for exceptions allowing them to exceed the state’s cap on annual property tax increases.

Act 1 of 2006 caps local property tax increases at no more than 1.3 mills percent annually. However, school districts can get around the law by applying for exceptions in nine different areas, including capital projects, special education costs and pension obligations.

If the state denies the exemption, voters in the district decide via referendum if they want to pay the higher taxes.

However, a recent analysis by the Harrisburg Patriot-News found Act 1 to be a failure because the state approved property tax exemptions “the vast majority of the time,” taking away the law’s stated goal of local control over soaring property taxes.

An expected drop in state-level education subsidies leaves many school districts in the state facing the same difficult choice as Southmoreland School District: raise local property taxes or cut spending.

Before the proposed budget was amended Thursday night, the school board was anticipating a property tax increase of 4.2 mils, said school board president Sam Accipiter. With the exemptions gone, the district will only be able raise taxes up to the 1.3 mils cap.

Residents in Southmoreland School District took matters into their own hands, convincing the school district to remove the exemptions from the proposed budget before the state has a chance to accept them.

For property valued at $100,000 a 1.3 mil increase would amount to an additional $130 in property taxes. Likewise, a 4.2 mils increase would amount to $420 in additional property taxes.

With the Southmoreland School District facing a $2 million deficit – most the result of climbing pension obligations – Mr. Accipiter said the decision was made with an eye towards coming years.

“It’s going to get worse this year, and then it’s going to get worse next year and the year after,” said Mr. Accipiter. “You can’t wait until the third year and then decide to start cutting things.”

Catherine Fike, a member of the school board, said the only option remaining for the district was cutting costs.

“How much more can we go and ask these people to give?” asked Ms. Fike. “You have to look at programs that do not work and you have to look at the supplementary personal who do not teach.”

About two-thirds of the district’s $30 million annual budget comes from state and federal taxpayers and the school board is bracing for significant cuts at both levels in the coming year. Gov. Tom Corbett has signaled he will look to cut $1 billion in state education funds next year.

Karen Kiefer, a resident of the district who attended Thursday’s meeting, said residents are concerned state cost-cutting will simply result in higher local taxes rather than an overall decrease in government spending.

“We didn’t go through all the trouble to elect people to cut the spending in Harrisburg only to have them raise the taxes locally,” said Ms. Kiefer.

Mr. Accipiter said the increased pension costs are the biggest hurdle in the coming years. Like all public school employees in Pennsylvania, those in Southmoreland School District enjoy a defined benefit plan.

“The employees in the district have good jobs and they have good benefits, but they are going to have give something up. We can’t keep putting it on the citizens,” said Mr. Accipiter. “In private industry, no one has a defined benefit plan anymore.”

After Thursday night’s vote, Ms. Fike said cuts are going to have to be taken seriously for the first time.

“I’ve never seen a cut. I’ve seen much hiring, but never a cut,” said Ms. Fike, who has lived in the district for 13 years. According to her calculations, the district has one employee for every eight students enrolled.

The number of students enrolled in Southmoreland School District has been dropping significantly in the past two decades. Since 2000, the district has seen its enrollment drop by about 10 percent. Despite the decrease, per pupil spending has increased by from $11,000 in 2000 to more than $14,000 this year.

The situation is mirrored statewide.

Public schools in Pennsylvania have seen an overall decrease in enrollment of about 1 percent during the past decade but state-level spending on education has increased by 26 percent. In other words, Pennsylvania is sending about $3,000 more per student today than in 2000.