Bethel Park School District budget calls for tax increase

Bethel School Board is scheduled to vote June 27 on adopting the district’s final budget for 2023-24.

Property owners can expect a new real estate tax rate of 24.5526 mills, or 4.8% over the current fiscal year, according to the proposed budget made available for public review. The amount represents the maximum allowed by the district under the Pennsylvania Department of Education’s Act 1 index, which determines tax increases justified by wage inflation.

The impact on a home assessed at $154,100, the district’s median, is an additional $173.

For 2022-23, the real estate tax rate is 21.7654 mills, ranking 21st highest out of 41 Allegheny County school districts. By comparison, the Upper St. Clair rate is 28.5628 mills.

Bethel Park’s general fund budget for the next fiscal year estimates $101.16 million in revenues and $108.12 million in expenditures. Use of $6.96 million from the district’s fund balance, representing assets minus liabilities, makes up the difference.

Douglas McCausland, district finance director and business manager, said at a June 20 school board committee meeting that a $5 million transfer from the general fund to the capital reserve fund shows up as an expenditure line item the budget, accounting for much of the revenue shortfall.

“We’ve been paying for the costs associated to the new elementary school from the capital reserve fund, and it’s starting to get rather low,” he said, referencing plans to construct a building to house all Bethel Park students in kindergarten through fifth grade. “We needed to move it over to just keep operations going and the cash flow going for that project.”

Another factor is impacting the budget negatively.

“We had an assessment appeal that was awarded to the South Hills Village Mall, which results in refunds from prior tax years of a little over $1.2 million. And then in the current year, we expect, based on the new reassessment value, a reduction in revenue collected of about $650,000,” McCausland said. “So that makes about an additional $2 million in deficit to the district.”

He explained that the loss of revenue carries forward to future spending plans.

“We’ll have to start addressing that as we build the next-year budget,” he said.

Barry Christenson, school board president, further addressed the reassessment of the South Hills Village property, located both in Bethel Park and Upper St. Clair.

“The new valuation is about $100 million lower than what it was previously, and that’s due to lower occupancy rates, lower income streams for the mall owner, and probably outlook, also,” Christenson said.

“It’s troubling. It’s concerning, but probably not unexpected when you look at the changes in consumer habits, buying online, things like that. It’s just the reality. In the long term, it does cause some concern, because they were the largest taxpayer to the district.”

The June 20 Bethel Park School Board committee meeting can be viewed at www.youtube.com/watch?v=zySnbe2qI7Y.