All public school districts, including Parkland, noted with alarm that Governor Tom Corbett announced a cut in the primary budget item supporting public schools by $550 million, or 9.5 percent, when he made his inaugural budget address on March 8, 2011. Along with local property taxes, this is a major source of funding for public schools in Pennsylvania. The overall cut for k-12 schools in his 2011-12 proposed budget is approximately $1 billion. With the information we have today from the Pennsylvania Department of Education, Parkland is estimating a loss of approximately $1.9M compared to overall Commonwealth funding received for the current school year.
Two primary cost areas of concern will seriously impact Parkland and were completely unanticipated, with good reason. First, the Governor is proposing that Parkland’s Social Security reimbursements be cut from 50% to our aid ratio of 26%. Since the minimum reimbursement rate of 50% is written in the state law (Act 29 of 1994), Parkland was shocked by this cut. The total amount of this change will add up to a $722,000 decrease in state funding. Only 158 school districts (out of 500) with lower rates of poverty in their communities are affected by this unprecedented cut in funding. Districts with higher rates of poverty will not see a decrease in Social Security payments. Many of these districts are currently reimbursed above the minimum 50% level.
The second cost area of concern involves reimbursements that Parkland receives from the state when a child living in Parkland decides to attend a charter school. Currently, under state law, we are obligated to pay 100% of the cost associated with educating the Parkland students at the charter school – even in the case of a cyber-charter school that can educate the student for less than what it costs Parkland. Charter school reimbursements from the state have traditionally come back to us the following year, but only up to a maximum of 30% of the previous year’s cost is written in the state statute. The proposed Governor’s budget eliminates this reimbursement category completely. The end result will be a $241,000 loss in revenue for Parkland.
Dr. Louise Donohue, Superintendent of Schools stated, “This is incredulous, especially when we compare charter school students’ proficiency scores in reading and mathematics to Parkland students. In a report presented to the School Board on March 15, Parkland students outperformed the charter schools at every grade level in the reading and math Pennsylvania System of School Assessment tests (PSSA’s). When you take into consideration the fact that charters can select who will be admitted into their programs, whereas Parkland accepts all students regardless of need, it seems punitive that the state would put the burden of funding the charters on the backs of Parkland tax payers.” To view the full charter school comparison report, click here: http://www.parklandsd.org/wp-content/uploads/2011/03/PSD-VERSUS-CYBER-CHARTER-SCHOOLS.pdf.
The two categories outlined above combine to create a new, unanticipated $1 million gap in Parkland’s revenue stream for the 2011-12 school year. Click here to view the breakdown of the $1.9M funding gap as presented to the School Board on March 15, 2011: http://www.parklandsd.org/wp-content/uploads/2011/03/Estimated-Commonwealth-Funding-for-11-12.pdf.
On February 15, 2011, the Parkland Board of School Directors approved a Preliminary General Fund Budget for the 2011-12 school year in the amount of $140,030,949, representing a 4.29% increase. If Parkland had the Governor’s information ( received March 8 ) before the need to pass the preliminary budget in February, the tax increase would have been 4.87%.
Also on February 15, Parkland filed for “exceptions” designed by the State to help districts pay for costs outside of their control. Exceptions give Parkland the flexibility to raise taxes above the state mandated Act 1 Index, which this year has been set at 1.4%. Parkland did file for exceptions related to escalating special education costs and fixed distributions to the Pennsylvania State Employee Retirement System – both mandated by the state. This week, Parkland received approval for both exceptions. The Special Education exception exceeded our expectation by approximately $350,000. This additional information establishes a 3.8% tax increase as the new ceiling at which the Board can raise taxes under Act 1 limitations.
Dr. Donohue remarked, “While we thought we planned for the worst case scenario, the Governor’s budget proposal has certainly provided us with additional cuts that are startling and unprecedented given the history of how Pennsylvania has funded public schools. Despite the challenges we are facing, we realize that members of our community are also struggling, and we are committed to closing our budget gap without negatively impacting our students’ education or cutting critical programs that make Parkland the quality district that it is today.”
As of the current school year, Parkland’s millage remains the lowest in Lehigh County when compared with 8 neighboring school districts. In 2010, Parkland’s tax increase in mills was the 2nd lowest out of the 9 Lehigh County school districts.