Residents who live in the Northern Lehigh School District will see a 2.38 percent increase in their property tax rate next year.

The school board unanimously agreed on Monday to adopt the 2010-11 budget with a 1.5 mill increase, which raises the millage rate from 62.873 to 64.373 mills in Lehigh and Northampton counties.

That means a person with a home valued at $100,000, and assessed at $50,000, will pay $3,219 in property taxes to the district next year, $75 more than this year's $3,144 rate.

Prior to the vote, Superintendent Michael Michaels said it was an arduous task for the district to formulate the budget.

"The board is very concerned about the budget and the governor's budget," Michaels said. "It's very difficult to make a budget when we don't yet have the money from the state."

Michaels said the district did as well as it could under the circumstances.

"It's a guesstimate," he said. "We're trying to run a great educational program to give our kids a great education, but not cost our taxpayers a lot of money."

Business manager Jeremy Melber said the $29,308,342 budget was the end result of three major areas that will impact the district over the next three to five years.

Melber said a 20 percent increase in health insurance, a 30 percent increase in electricity rates, and retirement contribution rates are what warranted the budget increase.

The spike in health insurance in 2010-11 will result in a $401,840 increase to the district's salary and benefit cost center, Melber said. Also, the district will see about a 30 percent increase in electricity costs in 2010-11, he said. Finally, employer contributions for employee retirements are also expected to spike over the next five years, Melber said.

Despite the increase, Melber said the district did the best that it could considering a mill only generates $218,000 for the district.

"Keep in mind that we adopted this budget with no layoffs and furloughs, a 20 percent increase in our health insurance premiums, and considering a $21 million elementary project," Melber said. "I think this budget represents a fiscal conservative stand for Northern Lehigh."

On a side note, Melber praised district food service director Sue Bahnick for being able to turn around the district's food service department.

Melber said at this point in time in the 2008-09 school year, the department was faced with an $83,000 deficit. Since Bahnick took over the position, he said the department now reflects a $39,000 surplus.

In addition, Bahnick was able to save the district $79,000 in food and milk prices, and by having more meals cooked in the cafeterias.

He said Bahnick deserved a lot of credit. At that, the board gave Bahnick a round of applause.

Director Lauren Ganser then extolled praise on Melber for his work with the budget.

"Don't sell yourself short, Jeremy," Ganser said. "The money you're saving (the district) is very much appreciated."

Last year, the board approved the 2009-10 budget with a .6 mill, or .96 percent, increase.

Also on Monday, the board approved the 2010 Homestead/Farmstead Exclusion Resolution.

Melber said the number of approved homesteads within the district is 3,871, while the number of approved farmsteads in the district is 33, for a total number of 3,904.

As a result, Melber said the preliminary calculation of the maximum real estate tax reduction amount applicable to each approved homestead and farmstead is $244.

In an unrelated matter, Michaels recognized senior Taylor Trapp for being a student representative to the board for the past two years.

Michaels said the recognition bestowed upon Trapp was "bittersweet," and added that he was excited for Trapp to be able to move on to a "new chapter in her life."

Trapp, who received a gift, said she learned how a school district runs during her time as a student representative.

Finally, Michaels noted that a scholarship won by two high school seniors during last month's senior awards assembly was incorrectly listed at that time.

Seniors Deanna Suozzo and Jocelyn Rodrigues both received the Rentschler Chevrolet Chrysler Jeep Dodge Scholarship, which Michaels said will be listed correctly in the graduation bulletin.