AASD property taxes on the rise
Board facing $9M deficit; fears state takeover
The Altoona Area School District is raising taxes next year.
The school board chose Tuesday between a $114 million budget plan with a tax increase and one without, and it chose to raise taxes. Facing a $9 million deficit at the end of next year and fearing a state takeover in future years, they said they needed all the revenue they can get.
The option they chose set a mill rate at 6.2053 mills — a 0.204 mill increase — which is about a $21 increase on the average residential assessed value of $103,000, according to district business administrators.
That will generate $620,600. With the revenue from the tax increase, the district projects a deficit of $8.5 million by the end of the year.
The board voted 5-4, as usual, but it was not the usual mix of members.
In a vote meant to challenge other members who claimed there are still budget cuts that could be made, Dutch Brennan and Bill Ceglar voted against any budget Tuesday.
“They say there are cuts to be made. I want to see it,” Ceglar said.
Sharon Bream and Ron Johnston also voted against the budget with the tax increase. They do believe budget cuts can be made.
And Ed Kreuz and Dave Francis voted for the tax increase along with Kelly Irwin-Adams, Rick Hoover and Wayne Hippo.
“I agree we need any money we can get,” Kreuz said. “To try to save the school district, we need all the money we can get. Even if it’s just $620,000. But there have to be areas to cut in the budget. Administration is the first place I believe we have to make cuts.”
There was argument about the $88 million building project as usual, but the annual cost of that project is between $2 million and $4 million. The real problem for the budget is the $19 million taken by the state for Pennsylvania’s poorly managed Public School Employee Pension System, Ceglar said.
“To fix this budget, we need increases in state funding — this PSERS problem is a Harrisburg problem,” Ceglar said, adding that the Legislature “screwed up” in the past by deferring payments to the system. He added: “$19 million per year is coming out of our budget because of PSERS. All districts are in this problem.”
Francis criticized Ceglar and Brennan for not voting for either budget option.
“You are shirking your duty,” he said.
Prior to the budget vote, board candidate Frank Meloy, who will be on the ballot in the November election, urged board members during the public comment period to take quick action to prevent the state from taking over the district, which Business Manager Camilla Houy confirmed could happen eventually if deficits continue.
“How can the district continue with deficit spending?” he said. Meloy is a retired assistant superintendent of the school district.
If the district goes bankrupt, the state government steps in. The fear among board members is that could happen in about seven years.
“The state dictates how to make expenses meet revenues. The integrity of the education program is going to deteriorate if the can is rolled down the road,” Meloy said.
The board passed a 2020-21 budget Tuesday night with a tax increase, and the remaining $8.5 million deficit could be covered by reserve funds. But that can’t continue years down the road, Meloy said.
“Beginning tomorrow,” Meloy said, “the board needs to discuss cutting next the year’s budget.”