NORTH PENN SCHOOL DISTRICT NEWS

Board votes ahead 4.49 percent tax hike, largest since early 2000s

North Penn School District tax increase set for June 20 vote

North Penn CFO Steve Skrocki, inset, shows possible tax increases for 2024-25 and the resulting revenue and projected deficit, during the school board finance committee meeting on April 23, 2024.

  • Schools

A near-record tax hike for North Penn’s taxpayers is now just one vote away.

Board members heard an update Tuesday night about the district’s planned 2024-25 budget, and accompanying tax increase, slated for final approval later this month.

“The recommended increase in terms of millage rate would be an increase of 4.49 percent. We will have a nearly-balanced budget, it’ll be a small deficit, but it won’t be a large deficit,” said district CFO Steve Skrocki.

In May, school board members voted unanimously to advertise a $322 million budget with a 4.49 percent tax increase, a $197 hike for the average taxpayer.

Since February, staff and the board finance committee held a series of special finance committee meetings presenting the 2024-25 budget requests for each department, and outlining the implications of a record-high Act 1 index, the state-set percentage at which taxes can be raised each year without a voter referendum.

The 5.3 percent Act 1 index rate set by the state for 2024-25 is the largest since that act became law in 2006. Each percentage in tax increase will generate roughly $2.1 million in new revenue for the district, at a cost of roughly $44 to the average residential property owner, based on an average assessed home value of $150,000.

The bulk of the increase, roughly $6.8 million, will go to contracted staff salary and benefits, the CFO has said, with $460,000 in added costs for charter schools, just under $600,000 in contracted transportation costs, and a $2 million transfer to capital reserves for planned renovations to North Penn High School.

    North Penn CFO Steve Skrocki, inset, shows a chart of the state-set Act 1 index of tax increases allowed without a voter referendum, during the school board finance committee meeting on April 23, 2024.
 
 

“We have made a few tweaks to the budget …,” Skrocki said Tuesday. “We actually increased (projected) revenues by $126,000, and expenditures also went up to the tune of $73,000, so there was a net positive change of $53,000.”

Staff levels may also see minor changes, based on talks with the board just ahead of the finance committee.

“Based on some conversations at the personnel committee meeting tonight, we’ll have a few additional changes, but it doesn’t change” the millage rate up for advertisement, Skrocki said.

No board members commented on the draft 2024-25 budget, before voting it ahead unanimously for final adoption later this month. The only public comment came from resident Bill Patchell, who questioned the need for the increase and asked how many district residents would be able to afford it.

“We’re gonna take it up to 4.49? I don’t like it, a lot of people don’t like it,” Patchell said, before predicting an exodus from the district: “the last day of school, or the very next day, the truck’s gonna pull up: ‘Billy, we’ve gotta move, we can’t afford the rent. Why? ‘Cause the school board members have decided on 4.49.'”

“You did say, ‘Since we were turned down with the referendum.’ You lost by 3,000 votes. Do you know what that means? That means everybody hates what’s going on. Why don’t you do 3 percent, and you take up the extra that you need to balance the budget, out of your available fund balance. You’re all terrible.”

    North Penn CFO Steve Skrocki (left), Superintendent Todd Bauer and Coordinator of Communications Media Bob Gillmer discuss a chart of proposed tax increases needed to pay for an expansion of North Penn High School during a Facebook Live stream on Dec. 6, 2023.
 
 

Regarding that fund balance, Skrocki gave an update, saying his office’s current projections are anticipating a massive year-end surplus, largely thanks to high national and global interest rates yielding higher than projected income on district reserves.

“At this point in time, we are projecting a positive variance on the revenues, for the fiscal year, of $13.9 million. The lion’s share of that comes from investment income,” he said.

“On the expenditure side, we’re expecting a positive variance or under-spending the budget by about $1.2 million. So even though the (2023-24) budget that was adopted did have a deficit when it was passed, we’re really pleased with the numbers,” Skrocki said.

No new developments have come from Harrisburg regarding a state budget and the accompanying subsidies, the CFO added, and the 2024-25 budget up for adoption includes the funding levels proposed in Gov. Josh Shapiro’s initial budget address.

One other budget-related item that could yield new income was also discussed: Skrocki told the committee his staff have compiled a list of properties they are vetting for possible real estate tax assessment appeals, where a sale of the property within the past year exceeds its most recent assessed value by $600,000 or more, and an appeal of the assessment could yield more tax revenue. So far 18 properties have been identified on a first review, and are currently being vetted by the district’s solicitor, and that list of properties for appeal could also be up for board approval on June 20.

“There was one property in particular that had a disconnect between the sales price and the implied market value of $21 million. That’s pretty substantial, and that could translate into additional tax dollars for the school district, potentially,” Skrocki said.

“Our goal here is certainly not to pick on any one property owner. It’s really to make sure that the property is being fairly assessed. For every property that is underassessed, somebody that is fairly assessed is paying their undue share of property taxes,” he said.

And possible good news for district taxpayers: the state’s homestead and farmstead exclusion for 2024-25 is set to increase by roughly $1.2 million statewide, largely due to increased revenues to the state from online sports betting. That increase results in a roughly $48 increase in the homestead and farmstead exclusions that the average district taxpayer could claim if they file, Skrocki said, and a formal resolution setting that level was also voted ahead by the committee for approval by the full board.

North Penn’s school board next meets at 7 p.m. on June 20 and the finance committee is scheduled to next meet at 6 p.m. on July 9, both at the district Educational Services Center, 401 E. Hancock Street. For more information visit www.NPenn.org.

 This article appears courtesy of a content share agreement between North Penn Now and The Reporter. To read more stories like this, visit www.thereporteronline.com.

author

Dan Sokil | The Reporter

Dan Sokil has been a staff writer for The Reporter since 2008, covering Lansdale and North Wales boroughs; Hatfield, Montgomery, Towamencin and Upper Gwynedd Townships; and North Penn School District.


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