Greater Latrobe eyes proposed 1-mill tax hike, projected 2% increase in insurance costs

Greater Latrobe School Board next week will consider final approval of a proposed 2021-22 budget, including a 1.17% increase in spending and a 1-mill property tax hike meant to cover a projected revenue shortfall of $345,000.

On Tuesday, the board also will look to renew district insurance coverages, with an overall 2% increase in premiums.

The proposed tax hike, to 85 mills, would add $27 to the average homeowner’s annual tax bill, according to district Business Administrator Dan Watson.

He said the district trimmed expenses where possible and recommended against trying to balance the $57.7 million budget without the tax increase. “I don’t think that would be responsible to our taxpayers,” Watson said.

“I think it’s a minimal intrusion on people’s budgets,” board member Dr. Michael Zorch said of the suggested 1-mill hike, given the unprecedented challenges the district faced for more than a year because of the covid-19 pandemic.

“It was scary, but we persevered,” Zorch said. Unlike some other districts, he said, “We had our students in school most of the year.”

Fortunately, Watson said, the district’s income stream didn’t lose as much to the pandemic as state officials predicted. While annual interest earnings have fallen sharply, from about $600,000 to as little as $25,000, he said there has been an offsetting increase in proceeds from the district’s real estate transfer tax.

Still, the district faces a projected revenue shortfall for the coming school year.

Greater Latrobe’s financial obligation to Pennsylvania’s teachers’ retirement fund, mandated by the state, plays a major role in that budget picture, according to Watson.

Over the 10-year period ending with the 2019-20 school year, Watson said, district expenditures excluding the retirement obligation increased by an annual average of $203,316, or 0.43%. By itself, the retirement cost has increased by an annual average of $700,162, or 69%, over the same decade, he said.

“If we didn’t have that, we’d be even,” school board member Bill Palmer said of the impact retirement costs have on balancing the budget. “It’s criminal.”

Richard Cassidy of local insurance firm Kattan Ferretti told the school board the district can expect to pay just under $5,500 extra for various insurance premiums in the coming year, representing a 2% increase.

That includes a 4.6% increase in costs for property and liability insurance. That increase may be even higher in the following year, Cassidy said. He explained property appraisals may be adjusted to reflect an increase in construction costs, triggered by the pandemic.

The board welcomed optometrist and former school director Dr. Rhonda Laughlin back to its ranks. She was appointed to serve until December, completing the term of late board member Steven LoCascio, who died May 8.