ANALYSIS OF BUDGET 2007-2008

We are pleased to present the 2007-2008 Bellefonte Area School District General Fund Tentative Budget.  Every effort has been made and continues to be made to find ways to minimize expenditures and increase revenues without diluting the educational program or putting undue pressure on the taxpayers.

Salaries and benefits continue to be the major portion of the district’s expenditures.  Approximately 68% of the total expenditures are due to salaries and benefits.  Existing salaries are projected to increase 3.2% or $555,130 with an increase in related benefits of $209,176.  Health insurance costs continue to escalate with a projected increase of $500,000 or 15.0%.  The district’s total health insurance budgeted costs are $3,850,000.  Retirement rates have increased as well from 6.46% to 7.13% or a 10.4% increase.  These rates are mandated by the state and the district has no control over these costs.

The district is also proposing adding three full time custodians at the High School due to the newly constructed additions.  The total cost including benefits of these positions is $122,826.

The largest increase in the budget is due to the additional debt payments from the 2004A bonds.  These debt instruments are to fund the building project at the High School.  The cost of the additional debt payments in 2007-08 is $900,000.  The debt payments should level off after this next budget year and remain constant unless the district would elect to refinance a bond issue.  The district evaluates its debt structure on an on-going basis in order to realize savings whenever possible.

The district is also projecting an additional $170,000 for tuition for Charter school students.   The district currently has 51 students enrolled at these schools with a budgeted cost of $8,093 for regular education students and $16,373 for special education students.   The total budgeted cost for Charter School tuition is $520,000 for the 2007-2008 school year.

The total expenditure increase for the 2007-2008 budget year is $2,785,000 or 8.2%.  Total expenditures will be $36,935,000 compared to $34,150,000 for 2006-2007 budget year.  The above mentioned factors account for 83% of the total cost increases realized in the budget.

The financial support for the Bellefonte Area School District programs and services is primarily derived from local sources of revenue; property taxes and earned income taxes.  The district will realize an additional $617,800 in real estate tax revenue due to additional assessments from new construction.  The district is projecting $3,700,000 in Earned Income Tax revenues for the 2007-2008 fiscal year.  The school district is also budgeting $600,000 in delinquent real estate tax collections.

State revenues account for 35% of the district’s total revenues, with the two largest being the state subsidies for basic education and special education.  These subsidies under the governor’s budget proposal are increasing $237,578 and $48,910 respectively.

Under Act 1, the district is required to place a referendum question on the May 15^th primary ballot asking the taxpayers if they would like to increase the Earned Income Tax rate from 1.05% to 1.90% to save approximately $397 from real estate tax bills for qualified homestead and/or farmstead properties.  Any household earning more than $46,705 in earned income would pay more in total taxes if this referendum is passed.  A qualified homestead/farmstead property is one in which the taxpayer primarily resides.  Rental units, commercial and industrial properties would not qualify for the exemption.  If the referendum question passes by a majority vote, the new tax rate will go into effect on July 1, 2007.

The federal revenues consist primarily of grants that the district feels confident that it will receive for the budget year.  Expenditures have been budgeted for the exact amount of the grant revenue, which results in no effect on the bottom line.  When additional grants become available during the year, the district will amend the budget to reflect the additional revenue and expenditures.

In order to support the programs and services in the proposed General Fund Budget, a tax increase of 1.706 mills or an increase in the tax rate of 4.5% will be required.  The district is using $1,755,000 of fund balance to achieve this tax rate.  This translates into an annual increase for the average homeowner in the Bellefonte Area School District of $78.58 in real estate taxes.  The Board of School Directors passed a resolution on January 23, 2007 indicating that it would not raise the tax rate by more than the index established by the Department of Education, which is 4.5% for the 2007-2008 fiscal year.

Dr. James T. Masullo Jr.             Kenneth G. Bean Jr., CMA Superintendent                            Director of Fiscal Affairs/Board Secretary      

Back to BASD School Board .

Our Mission 
It is the mission of Bellefonte Area School District to educate all of our students in a learning environment that prepares them to meet life's challenges.