Chambersburg Area School District faces $1.3 million deficit

January 14, 2010

With a $1.3 million budget deficit and increasing benefit costs, the Chambersburg Area School District is requesting a tax increase that would go above district’s adjusted base index.

Business manager Steven Dart outlined the proposed budget at Wednesday night’s school board meeting. The district is proposing raising the tax rate from 84.94 to 89.61 mills, a 5.05 percent increase.

The district’s earned income and transfer taxes, along with interest income, had a combined deficit of $2.8 million compared to 2008-2009 budget projections. The district implemented cost control measures during the last school year to curb spending and also left about 15 positions unfilled, but Dart said it wasn’t enough to offset the deficit.

Dart said the district is not expecting an increase in state Basic Education, Special Educatio n or grant funding in the next state budget. Additionally, the district has seen an $850,000 in the amount that it has contributed to the Public School Employees Retirement System and a 14 percent increase in health care expenses that were already costing around $14 million.

Additionally, the prognosis for earned income tax revenues have dropped from $15.1 million to $14 million and the district is not expecting an increase in Basic Education, Special Education or grant funding through the state.

For a homeowner with a home appraised at $100,000, the increase would result in an additional $48.59 in tax from the increase. Even with the proposed tax increase, the district expects a budget shortfall of $1.3 million.

"This has been the most challenging budget process," Dart said.