Burrell School District now considering 5.8% increase for property owners

Burrell School District is now thinking of a 5.8% tax increase in its proposed budget for the upcoming school year.

The district released a proposed budget that includes an increase of 6.5 mills, which would account for future bond payments for capital improvements and construction, said Finance Director Jennifer Callahan.

Callahan in March drafted a budget that included a 4% tax increase, or 4.5 mills, to offset operating costs.

Two mills of taxes, on top of the 4.5 mills, are for future bond payments for capital improvements or construction, she said.

When asked what those projects are, Callahan said: “The board has not made any official decision regarding specifics at this time.”

The proposal would increase the district’s millage rate from 111 mills to 117.5 mills.

Under a 6.5-mill increase , the owner of a home with a median assessed value of $23,000 would pay about $2,700, Callahan indicated. A longtime Burrell homeowner who qualifies for a Homestead Act reduction would pay $2,445 ($258 less).

That equates to an increase of $150 a year without the Homestead exemption and $106 annually with it.

The total proposed budget expenditures are $36.5 million, Callahan said. Changes made since the draft budget include a $68,500 decrease in expenditures and a $29,600 increase in revenues, resulting in a deficit of about $172,000.

Burrell administrators are looking at ways to close the deficit before passing the final budget in June, Superintendent Shannon Wagner said.

Renovations

The district is floating an idea to take out two $10 million bonds to pay for options for renovations at Bon Air Elementary, Huston Middle School and Burrell High School.

If the district were to close Stewart Elementary School, it would move fourth grade classes to Bon Air, build an add-on to a cafeteria there and have the middle school hold fifth through eighth grades. Construction would include paving and HVAC upgrades at Bon Air, the middle school and high school. That work has an estimated price tag of $20 million.

The other option, estimated at $26 million, would have kindergarten through fifth grade at Bon Air, add on to the cafeteria and build seven additional classrooms there. Construction also would include paving and air conditioning at Bon Air, the high school and the middle school.

The renovations at the other district buildings are necessary, district officials say.

It would cost at least $17 million to renovate the 93-year-old Stewart building.

The district would see about $200,000 each year in savings if it were to close Stewart, Wagner said. A mill’s worth of taxes in Burrell is $154,000.

“That’s a little bit more than a mill of taxes that will help us and help our community,” Wagner said.

If closed, the building would be sold by the school district.

“Our intention is to sell the property with the hope that it would produce tax revenue for the district,” she said.

The district is pursuing grant funding from the state that would help pay for HVAC work at the high school. If it gets the grant, it would pay for $5 million worth of the work, and the district would have to come up with about $3 million.

What contributes to the increase

An increase of 4.5 mills in taxes is needed to offset district operations, Callahan said.

“There has been no natural growth from real estate,” Callahan said. “The assessed value of the district is essentially the same as the prior year, resulting in no revenue increase without increasing the millage rate. The overall assessed value of the taxable properties in the district are at about the same level as they were in 2015-16.”

Federal revenue has decreased by nearly $900,000, Callahan said. School districts across the Alle-Kiski Valley are reporting similar drops; they’re attributed to the end of certain covid-19 pandemic-related funding for schools.

Costs of special education services and placement tuition, as well as cyber school tuition, have increased by more than $265,000, Callahan said.

“Over the past few years, the number of students needing placement has tripled to 18, and the number of contracted classroom aides and paraprofessionals needed to support our students has increased from 19 to 26,” Callahan said.

Burrell’s contribution to the Northern Westmoreland Career and Technology Center has increased by nearly $83,600.

Employee medical insurance costs have spiked 12% because of increases in the cost of services and an increase in the amount of services.

Callahan said the final budget having a 5.8% tax increase is “likely, but not yet officially decided.”

“There could be changes in the budget between now and then,” she said.

The final budget and tax increase is scheduled to be approved June 18.