On Tuesday, May 20, 2014, the Keystone Oaks School Board, in a Special Voting Meeting, approved the adoption of the 2014/2015 Proposed Final Budget in accordance with Section 687 of the School Laws of Pennsylvania. The 2014/2015 Proposed Final Budget is estimated at $37,594,707 with the levying of 18.63 mills. This is the same millage as during the current school year. Thus, the Board has approved a Final Proposed Budget with no tax increase. The approval of the 2014/2015 Final Budget is scheduled for Thursday, June 19, 2014.
The Final Proposed Budget will be made available for Public Inspection for 20 days beginning no later than May 29, 2014. The Final Proposed Budget may be viewed by contacting the Director of Fiscal Services.
Pennsylvania school boards – except in the cities of Philadelphia, Pittsburgh and Scranton – operate on a fiscal-year schedule that begins July 1. They have to pass their final budgets and tax resolutions by June 30 for the upcoming school year.
The Taxpayer Relief Act enacted in 2006, commonly called “Act 1,” is intended to reduce taxes for homeowners and farmers and allow voters to control school tax increases. Act 1 introduced major changes and new deadlines into the school district budget process.
Act 1 allows school districts to accept state gaming revenue to offset property tax reductions which result from homestead and farmstead exclusions. Homestead and farmstead exclusions lower assessments, which result in lower property taxes, for qualifying homeowners and farmers.
School districts may also reduce property taxes by levying a personal income tax to replace their earned income tax, or by increasing their earned income tax.
Earned income tax is based on wages and salaries. Personal income tax considers additional income sources, such as investment and pension income.
Voters decide, by “back-end referendum” in the spring primary election, whether to allow their school district to raise taxes beyond the district’s “adjusted base index,” which is an inflation rate calculated for their district by the Pennsylvania Department of Education.
A school board may refuse state gaming revenues. If it does, the voters have to agree by referendum in the next primary election. If the voters disagree with the board, the question comes up for a vote again in the following fiscal year.
State gaming revenues are not guaranteed. Whatever the state takes in from gambling each year goes first to fund property tax and rent rebates for seniors and disabled Pennsylvanians, and then to school districts to offset property tax reductions.
School districts find out in May if they will get state gaming funds, and how much. If funds are available, districts get 50 percent in August and 50 percent in October.
The Public School Code allows school boards to increase spending after a budget is passed “to meet emergencies, such as epidemics, floods, fires, or other catastrophes, or to provide for the payment for rental under leases or contracts to lease from the State Public School Building Authority or any municipal authority entered into subsequent to the date of the adoption of the budget.” In such cases, additional funds can come from other budget categories, from “unappropriated revenue, if any,” or, by a 2/3 vote of the board, from a temporary loan.
The board is allowed to move unspent revenue from one budget item to another, but only during the last nine months of the fiscal year (October through June).