CLARION, Pa. (EYT) — Facing a $1.27 million deficit in its 2015-16 preliminary budget, the Clarion Area School District faces the possibility of enacting a maximum tax increase approved by the Commonwealth and making cuts or reductions in “non-mandatory” programs and activities in order stay afloat.
(Photo courtesy of Gina Mazzocchi)
School Board President Eric Funk says changes must be made in state funding or else Clarion’s future is uncertain.
“Unless Harrisburg changes how they fund schools, unless they address the pension problem, and unless Clarion Area is funded fairly and ethically, there’s nothing our local board can do to keep the day of reckoning from coming. If the money runs out, then the rumors of closing would be true,” emphasizes Funk.
The first of three public sessions regarding the proposed budget was held Tuesday night, and the board outlined the budget and accepted comments and listened to concerns from district residents. The public is encouraged to contact their legislators and the governor’s office about adjusting basic education funding. The complete power point presentation at the public meeting is available by clicking here.
“We hope and pray that that’s not the case, but absent action from Harrisburg that will be what happens,” continues Funk. “Not next year, not two years, or maybe five years, but it’s out there. The state would step in and take over the district as a distressed school. There’s a history there, and it wouldn’t be the first school district that it happened at.”
“The school board can do some things to forestall it, but the truth is that it depends on what actions it decides to take. The maximum tax increase would generate $330,000.00 and that would shave the deficit down to $940,000.00. Whatever expense cuts the board decides to make, pares it down to whatever level the community and board can stand. We continue to hope for some sanity out of Harrisburg.”
Asked how the funding situation deteriorated so rapidly, Funk said projections had been made at Clarion since 2006, and it appeared the district could be facing funding problems down the road. Funk cited an increase in mandated pension payments from 4.76 percent in 2008-09 to 25.48 percent in the 2015-16-budget year.
Even though the pension payments “accelerated and acerbated things over the last three or four years,” Funk sees the main problem for Clarion is really the lack of a fair state funding formula. The funding is based on the 2008-09 reimbursement.
He explained the budget process.
“Clarion Area’s preliminary budget that we passed using the format required be eligible to be granted Act One exceptions means that we can tax higher than the Act One index,” said Funk. (While the Clarion School District has received approval for the maximum tax, it has not yet decided to do that.)
“Absent a tax increase, it shows a $1.27 million shortfall. With a $1.47 million fund balance (reserves) one could make the case that fiscally we have some awfully tough decisions to make, and that’s certainly true. The board can decide it can do several things, and one of those could be to pass a budget that certainly requires a sizeable payment of our fund balance or reserves. School districts are required to pass a balanced budget, so if we have a shortfall of revenue vs. our budgeted expenses, it simply requires a transfer from the general fund operating balance to balance the budget. If we pass a budget with a shortfall of $800.00 to $900,000.00, we would then only $400,000.00 to $600,000.00 left over in reserves for the 2016-17 fiscal year.”
Clarion School District reported that during the last several years, it has reduced the teaching staff by 20 percent, reduced administrative staff by 20 percent, reduced all areas of support staff, eliminated elementary athletic positions, and reduced operational costs.
In addition to the earlier cuts, the School District listed possible allowable expenditure reductions as:
- Athletics and Other Co-Curricular Activities
- Books and Supplies
- Field Trips
- Maintenance of Buildings
- Non-Mandatory Programs and Personnel in: Art, Elective Courses, Elem Phys Ed, Full Day Kindergarten, Guidance, Industrial Arts, Library, Music, and Technology.
Funding and Costs Analysis
An analysis offered by a concerned citizen at the meeting provided a look at cost to reimbursement in 2012, from figures reported by the Commonwealth. The review also shows Clarion Area has become more efficient and effective in its Actual Instructional Expense (AIE).
Copies of the analysis are available via the Clarion Area website or clicking here and provides much greater detail than this article for a more comprehensive look.
The state’s reimbursement for Basic Education Funds (BEF) distributed to the various Clarion County School Districts clearly shows the inequity that has grown from the lack of a fair allocation method.
Enrollment in the Clarion County School Districts has decreased approximately 25 percent during the past 20 years, which is over 2,000 students.
The wide distribution of reimbursement continues, with Clarion Area at 40 percent and Union at 96 percent of their budgets or Clarion Area receiving $3,153.00 and Union receiving $8,341.00. The hold harmless policy assumes that all the school districts have equal changes in Average Daily Membership each year. This is simply not true.
A-C Valley has lost the highest percent of students, and their AIE per Average Daily Membership (ADM) has increased to the highest of all the Clarion County Scholl Districts and is also higher than the average for the state. The hold harmless policy continues to provide them the same gross amount of Basic Educational Funding regardless of their change in Average Daily Membership. A-C Valley spends more for AIE because it has more money.
Union has lost the second highest percent of students, and their AIE per ADM has increased to the third highest in the county. Union is now reimbursed at 96 percent of its costs because the hold harmless policy continues to provide them the same gross amount of BEFs regardless of their change in ADM.
Union SD receives reimbursement per ADM from the state on the hold harmless policy for Basic Education Funding at 2.645 times per that of Clarion Area. ($3,153.00 times 2.645 = $8,419.00).
A-C Valley SD receives reimbursement per ADM from the state on the hold harmless policy for BEF at 2.436 times per that of Clarion Area. ($3,153.00 times 2.436 = $7,682.00).
What’s next?
Recommendations included:
- Adequate state funding of our public schools in the Commonwealth. (We need enough money so that all schools have adequate funding to meet the state’s academic requirements. Taking money from a school district won’t work because that will cause votes in the Legislature to be lost; therefore, we need to hold the line on some while bringing up the funding for others.)
- A fair basic education funding formula that is equitable to all the school children in the commonwealth. (As a citizen of the commonwealth, you pay the same taxes as required by the state, so why is Clarion Area School District being discriminated against because the Legislature is unable to do their job and implement fair distribution of AIE funds.)
- An adjustment in allocation of the basic education funding for the Clarion Area School District (CASD) to allow it to sustain itself while the state fixes the formula. The allocation must include enough funds to allow CASD to continue without cutting courses or activities for our children. This amount would be approximately $1,500.00 per student or approximately $1.2 million.
- Reform for the public school pension fund that is fair and equitable to both the taxpayers and the members of the public school pension fund.
Residents were also urged to contact Senator Scott Hutchinson, 320 Seneca Street, Oil City, PA 16301 and Representative Donna Oberlander, 160 South 2nd Ave, Suite C, Clarion, PA 16214.
