The move follows three consecutive years of maximum and near-maximum property tax increases
The Souderton Area School District is facing another tough budget season as the district’s expenses continue outpacing its revenue growth.
At the board’s most recent finance committee meeting, Business Administrator Michael Taylor presented the district’s current 2026-2027 budget outlook. With a maximum allowable tax increase of 3.5%, the projected budget includes $163 million in revenues and $168.7 million in expenditures, yielding a $5.7 million deficit.
In light of the projected deficit, Business Administrator Michael Taylor revealed that the district applied for an exception to the Act 1 Index to permit a higher tax increase. The Act 1 Index is an annual limit on Pennsylvania school district property tax increases without voter approval. However, districts can apply for exceptions for specific expenses like special education.
The exception could allow for an additional 0.85% tax hike. The Pennsylvania Department of Education will issue a decision by the end of the month, said Taylor.
The move follows three consecutive years of maximum and near-maximum property tax increases, which board members have attributed to soaring special education costs and charter school tuition amid insufficient state funding.
At the finance committee meeting, Taylor’s presentation showed a continuation of previous budgetary trends. Under Governor Shapiro’s 2026-2027 budget proposal, the district would receive an additional $98,000 in basic education funding and $122,000 in special education funding, amounting to 0.79% and 2.98% increases, respectively.
Meanwhile, the district continues to grapple with rising expenses, namely special education and employee medical benefits. Since 2020, Taylor noted, the district’s special education expenses have increased by $11 million, while state special education funding has increased by just $800,000. Local taxpayers have been forced to cover the difference, said Taylor.
Superintendent Frank Gallagher attributed the district’s rising special education expenses to a post-COVID surge in the number of special education students requiring costly extra services, both for learning disabilities and behavioral and mental health problems. Some students need specialized instruction at private schools, Gallagher added, further raising the district’s private school tuition and transportation expenses.
The administration will continue monitoring local revenue sources and factoring in retirement savings as work progresses on balancing the budget, said Taylor. The proposed final budget will be presented in April. Adoption of the final budget is scheduled for June.
Student representative
The board discussed the addition of a student representative to the school board. Gallagher noted that an increasing number of school boards are adding student members and suggested one of the student representatives who reports on district events at board action meetings. Board member Kim Wheeler also suggested an AP Government student.
Gallagher directed Superintendent Christopher Hey to add language to the board’s meetings policy on a student school board member. The policy is scheduled for a first reading vote at the board’s March 26 action meeting.
The next Souderton Area School Board meeting is on March 26 at 7 p.m. For more information, visit soudertonsd.org
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