Jan 21, 2015 By Suzanne Elliott 2 min read

Peters Township School Board members agreed at the Jan. 20 meeting to ask the Pennsylvania Department of Education for an exception – as required by Act 1 – to allow it to increase real estate tax.

The Peters Township School District is facing a $2.5 million budget shortfall for the 2015-16 school year and has said at previous finance meetings it was looking at increasing real estate taxes by 2.03 mills, which would bring the gap to $1.87 million.

The state has calculated the base index for the 2015-2016 fiscal year as 1.9 percent, which in Peters equates to an increase of 2.03 mills, said Shelly Belcher, a district spokeswoman.

The district’s anticipated budget for the next school year is $60.45 million, while revenue is anticipated to top out at $57.91 million. Seventy percent of the district’s revenue comes from local sources, and roughly 30 percent comes from the state.

The conundrum facing Peters are mandatory and escalating costs, such as special education, retirement contributions and construction. In other words, the district’s hands are tied.

“Special education and larger pension contributions have increased substantially during the last two years,” said board member William Merrell, who chairs the board’s finance committee.

The state allows school districts to request exceptions for specific items, like special education, pensions and contracts, Belcher said. But, to do so, the board needs to adopt a preliminary budget by Feb. 17.

Even if a preliminary budget is adopted next month, township residents will not see real estate tax increases for several months because the district’s fiscal year ends June 30.

The impact on township homeowners should be minimal. If a property owner’s school tax is $1,000, the amount would increase by $18.95 a year. The average annual household income in Peters is $152,000 a year, Merrell said.

In other matters, the board spent considerable time talking about several projects proposed and planned for McMurray Elementary School before agreeing to table plans so it can makes sure it will be reimbursed some of the costs associated with the projects.