Property owners on the Carbon County side of the Panther Valley School District won't see an increase in their real estate tax this year, but those on the Coaldale, Schuylkill County, side will likely have to pay 6.37 percent more.

The school board on Thursday approved a $23,800,000 preliminary budget that calls for a 3.13 mill tax increase in Coaldale, bringing that rate to 52.24 mills. The rate on the Carbon County side would remain at 55.69 mills.

That means the owner of a Coaldale property assessed for taxes at $25,000 would pay $1,306. The owner of a building of equal value on the Carbon County side would continue to pay $1,392.25.

The disparity results from different assessment formulae used in each county. Business manager Kenneth R. Marx Jr. said that the proposed rate increase in Coaldale is due to millage rebalancing. For the last three years, he said, Coaldale rates have decreased 1.8 mills for the same reason.

"This shift in tax rates is primarily because of the loss of $574,820 of assessed value in reassessment of the coal lands owned by BET (formerly LC&N)," he said. "Expenses have increased by 4 percent. The majority of that is the increase in the (Public School Employees Retirement System) pension costs of $318,284. We are trying not to cut staff and only reduce staff through attrition."

Board President Jeff Markovich said this would be the third year with no tax increase for Carbon County property owners.

The budget calls for $23,800,000 in expenses and $22,300,000 in revenue, leaving a $1.5 million gap that will be filled from the district's fund balance. That would leave the account with $3.8 million, Marx said.

That prompted board member David Hiles to warn his fellow school directors about the plight of some other districts that have been forced to lay off staff after depleting their fund balances.

"Sooner or later, the fund balance is going to run out," he said.

School director Bill Hunsicker said $1.5 million is equivalent to about 9 mills. The district would be prohibited by law from increasing taxes to that extent, leaving it no choice but to cut programs and staff.

School director R. "Mickey" Angst urged the board to reign in expenses.

"We're spending like we have it, but we don't have it," he said.

As of January, Marx anticipated that each mill would generate $123,574 in Carbon and $18,514 in Coaldale, based on an 88 percent collection rate.

The board expects to adopt a final 2012-2013 budget on June 14. Board member Irene Genther has called for at least one more budget meeting to try to reduce the Coaldale rate. However, Marx said it's unlikely the numbers would change.

In a related matter, Marx said that updating the district's power system is helping to ease the money woes.

"The performance contract we entered into with Schneider Electric was designed for the district to make much-needed improvements while saving money by updating other areas of our infrastructure," he said.

The project planning began in September of 2008 when Marx, maintenance supervisor George Krajnak and Superintendent Rosemary Porembo met company representatives to discuss district needs and concerns, and determine where small adjustments could result in energy savings.

Marx said there were over 25 meetings like that in addition to nine periodic meetings with the board to approve various steps of the project.

"There were six phases of the project. The cheapest phase was correcting the building air sealing," he said. "This part saved the largest amount of savings while costing the least. The most expensive part was the rooftop HVAC unit replacement at the high school. This phase was a necessary replacement. The project started during the summer of 2010 and was officially completed in March 2011. As of November 2011, the district has saved $82,804 in electric and fuel oil costs, which is on track to exceed the guaranteed annual savings of $105,507."