Many variables could impact NASD 2018-19 budget
While Northampton Area School District taxpayers may be circling the wagons in the face of a possible tax hike for the 2018-19 school year, the calvary may be headed to the rescue. Or more to the point, FedEx Ground and other commercial projects may be headed to the rescue with increased tax revenue.
NASD Board of Education has approved the preliminary budget for 2018-19 with a general fund of $107,532,563, athletic fund of $219,125 and food service fund of $2,446,795.
“I emphasized previously, many things are going to change between now and June,” NASD Superintendent of Schools Joseph Kovalchik said at the Jan. 22 board of education meeting when the preliminary budget was approved 8-1.
The preliminary budget has expenditures of $107,532,563, revenue of $101,481,113 and a deficit of $6,051,450. Use of $400,000 from the committed fund balance, $3,420,000 from the unassigned fund balance and increasing property taxes by 3.9 percent is proposed to close the deficit.
“We’re going to get that number down,” Kovalchik said. “I’m not sure how we’re going to do it because the ultimate goal is to get that increase down to zero.”
The school board vote Jan. 22 authorized the administration to seek approval from the Pennsylvania Department of Education for exceptions under Act 1 that, if approved, will permit NASD to increase the tax rate for fiscal year 2018-19 by more than the 2.9 index.
Millage would increase 2.06 mills from 52.77 to 54.83 mills, which is a 3.9-percent increase.
Based on the 2017 average NASD assessment of $58,223.43 and a 2017 tax bill of $3,072.45, the 2018 tax bill would increase to $3,192.39 — or $119.94 annually, $9.99 monthly and $2.31 weekly.
Among the variables facing the administration and school directors as budget deliberations continue in advance of the June 30 final budget passage deadline are:
• State budget allocations are unknown, especially since the state budget passage often doesn’t occur until after school districts’ budget deadlines.
• NASD retirements are expected to be submitted in February.
• Revenues from commercial and residential development may add to NASD tax coffers, perhaps as soon as this fall.
• Fluctuations in interest rates and the national economy impact are always an uncertainty.
• Increased student enrollment may require the hiring of more teachers.
“There are a couple of developments occurring in our school district expected to contribute revenue,” Kovalchik said during the Jan. 22 budget discussion.
FedEx Ground and two warehouses in Allen Township are approved. The FedEx occupancy permit is expected in August, after which tax revenue can be collected.
“Those three structures we’re expecting will add approximately in excess of $3 million per year,” Kovalchik said.
Developers of the Jaindl and Watson project seek a right of way along Seemsville Road and placement of a detention basin on the district’s 92-acre Seemsville property, owned since 1995 as a possible school site. This development at Route 329 and Seemsville Road could add $1.8 million in annual tax revenue. Add to that the Jaindl development at a former monastery in Lehigh Township, a Liberty Trust project near Miller Supply Ace Hardware and a project at Route 329 and Airport Road, and NASD stands to rake in a total of an estimated $6 million in additional annual tax revenue, starting in approximately three years.