Northern Lehigh School District's ability to craft next year's budget with a zero mill increase has no doubt placed it in rare company.

So much so, that several district administrators attended a recent luncheon with state Gov. Tom Corbett at DeSales University. Corbett addressed the current state budget.

At that time, Corbett asked Superintendent Michael Michaels and business Manager Jeremy Melber to stand and be recognized for their "outstanding job" with their 2011-12 budget.

Michaels said Corbett further stated that he, Melber, the Northern Lehigh School Board and the NL community were "getting it right."

Last week, the board, on a 7-2 vote, adopted next year's spending plan with a zero mill increase, which included no major K-12 educational program cuts, no pay freezes and no furloughing of teachers, administrators, or staff members.

However, Michaels cautioned the district's ability to arrive at that destination "was not an easy task by any means."

"District administration had an insight many months ago to possible basic education subsidy cuts that would be presented in Governor Corbett's state budget," Michaels said. "They met as a team and discussed ideas on how to move forward if in fact the district did lose hundreds of thousands of dollars in basic education subsidy."

One idea, Michaels said, was to implement a Retirement Incentive Plan, which was presented to the board and adopted in January.

"Within days, the Retirement Incentive Plan was rolled out to the professional staff," he said. "They were given until April 6 to advise the district if they would be participating in the Retirement Incentive Plan."

In February, Corbett's state budget was released, at which time Northern Lehigh saw a decrease in their basic education subsidy in the amount of $618,637, Michaels said. In addition, Corbett also proposed to cut the Accountability Block Grant, Dual Enrollment Grant and Charter School Funding, which resulted in an additional loss of over $455,000 to the district, he said.

As a result of the state budget cuts, as well as increases to health insurance, retirement and payroll, the district's general fund budget for the 2011-2012 school year was at a deficit of $1.8 million, or 6.2% of the overall budget, Michaels said.

To help offset that deficit, 14 staff members elected to participate in the Retirement Incentive Plan, which realized a savings to the district's general fund budget in the amount of $1.2 million, he said.

Michaels said that, coupled with the realignment of staff and cuts to various department budgets, enabled the district to present next year's budget with a zero mill tax increase.

"During the 2009-2010 and 2010-2011 school years, Northern Lehigh School District received federal stimulus money in addition to their basic education subsidy," he said. "Northern Lehigh School District knew that the federal stimulus money wouldn't be around forever, and had the foresight to use this money for one-time investments, only alleviating the chance of ongoing expenses in future budget years."

Final approval of the 2011-2012 district budget is expected at the June 13 school board meeting at 7:30 p.m. in the middle school auditorium.