Probable NASD tax hike reduced to 2%
Call it School Budget 2.0 — or, more precisely, 2.01.
That’s the percentage of tax increase Northampton Area School District Board of Education favors for the 2018-19 budget.
Based on a straw vote at the May 21 board of education meeting, seven of nine school directors said they favored the lowest possible tax increase: 2.01 percent, or an increase of 1.06 mills, which works out to a $61.72 annual increase, $5.14 monthly increase and $1.29 weekly increase based on the NASD average property assessment.
In the straw vote taken by NASD Business Administrator Terry Leh, in favor of the 2.01-percent tax hike were school board President David Gogel, Vice President Chuck Frantz and school Directors John Becker, James Chuss, Roy Maranki, Robert Mentzell and Ross Makary.
School Director Dr. Michael Baird withheld his straw vote. School Director Chuck Long- acre was absent.
The straw vote gives Leh guidance to prepare the final 2018-19 NASD budget, which is expected to be on the agenda for an up-or-down vote at the next school board meeting, set for 6:30 p.m. June 11 in the NASD Administration Building, 2014 Laubach Ave., Northampton.
In proposing the 2.01-percent increase, NASD Superintendent of Schools Joseph S. Kovalchik said $100,000 would be taken from the 2018-19 NASD budget contingency fund. He added the district is estimating an additional $400,000 in tax revenue from the FedEx Ground facility, scheduled to be in operation in September.
In not supporting the 2.01-percent increase, Baird said after the meeting, “I don’t like to spend money that we don’t have.”
Of the expected Fed- Ex tax revenue, Baird said, “It’s anticipated,” adding, “Are we going to get $1.2 million? I don’t know.”
After the meeting, Kovalchik and Leh said they estimate the new FedEx Ground facility will generate $1.2 million per fiscal year for NASD, or approximately $100,000 per month. Tax revenue is expected to be generated once FedEx is granted a certificate of occupancy, which is expected in September. The amount of FedEx tax revenue to NASD anticipated September to December would be $400,000.
Kovalchik emphasized the 2.01-percent tax hike does not slash NASD staff positions or programs.
“All those figures include all positions in the budget. Anyone who has retired, we will include those positions in the budget. That’s not reducing any curriculum or programs for this year. It includes the Lehigh Elementary School project,” Kovalchik said to school directors prior to the straw vote.
Also before the vote, Mentzell asked, “None of this will damage our bond rating?”
“No,” Leh replied.
Gogel asked for reassurances that $400,000, or 0.38 mill, is intact for the Lehigh Elementary School project in the 2018-19 district budget.
Kovalchik reiterated it is.
“That sale of bonds has helped us keep the millage rate low,” Gogel asserted.
“I don’t believe in counting FedEx money before it’s in our pocket,” Baird said before the straw vote was taken.
After the straw vote, Kovalchik recounted the 2018-19 NASD budget timeline, noting the tax hike initially was 3.9 percent when the budget was proposed in January.
“We’ve said that the board would do its due diligence, and it has,” Kovalchik said.
“The board has said we’re going to do everything we can to share that FedEx revenue with our residents. At some point, that FedEx revenue will come in during this fiscal year,” Kovalchik added.
“We’re finally looking at some revenue coming in,” Leh said. “It’s something we haven’t seen in the past.”
Kovalchik said NASD still has four main areas that are driving budget expenditures increases: Pennsylvania State Employees’ Retirement System (PSERS), special education, health care and charter schools.
“Nobody wants to see their taxes to go up,” Kovalchik said. “The board has analyzed [the 2018-19 budget] and broken it down and been as fiscally responsible as possible.”