Panther Valley School District could go broke, says board member
Panther Valley School District residents can anticipate a real estate tax increase of either two or three mills for next year, and even then the district could be in trouble in two years.
The district budget and finance committee debated cost-cutting measures for nearly two hours Thursday, discussing tax increases and what appears to be the district's dire financial future.
Some board members said the school district could be broke in two years unless state legislators increase funding to local districts.
Six of the nine members of the board attended. Three wanted no more than a two-mill tax increase. Three said a higher increase is needed.
Some said another tax increase will be needed next year.
Business Manager Ken Marx said the major detriments to the budget are retirement payments and the costs the district must pay for students who attend charter schools.
More than $800,000 is given to privately owned charter schools by the district.
The amount is based on the number of district students attending charter schools.
Marx said the district will operate its own special education program instead of outsourcing this specialty to save about $170,000.
He warned that in the future, cost-cutting measures could include gutting programs, cutting back on sports program funding and increasing class sizes.
Property tax reform might not help the district because if the state uses sales taxes, state income taxes or local income taxes for district revenue, "We won't be able to raise taxes," Marx said.
Board member Anthony DeMarco said Panther Valley's situation is not unique.
"Everybody's in the same situation," he said. "In 2-4 years, many school districts will go belly-up if (the state) doesn't fix the pension crisis."
DeMarco said he has no objection to raising taxes for things the school directors can control.
"But I'm not going to raise taxes here because it's their job (in Harrisburg) to do it. I'm not going to do their dirty work." DeMarco said.
Marx proposed a 4.1-mill tax increase. DeMarco, Michelle Markovich and Irene Genther voiced strong objections.
"You don't sucker punch people like that," Markovich said, referring to the 4-mill proposal.
She added that delinquent taxes presently total $900,000. "Can you imagine what it will go to if we raise the taxes," she said.
She said many people are struggling financially and "if you can't pay (taxes) now, how can you pay them if we add several hundred dollars."
Board member Bill Hunsicker said, "If you don't put four mills on this year, you will put four on next year."
Superintendent Rosemary Porembo said class size is already up to 32 students in some seventh and eighth grades. She warned that cuts in the future could jeopardize such things as the school newspaper, school yearbook, sports and other extracurricular activities for students, in addition to forcing an increase in other class sizes.
"These are the things that are left that we have to cut," she said.
Board member Dan Heaney said if the millage isn't raised enough, transportation, kindergarten and sports could be affected next year.
"We'll be looking at everything not mandated by the state," he said.
John Williams, a board member, said, "I feel we should be at minimum in the three-mill range and know we will have to raise it again next year."
Markovich asked the board, "Have you seen the for-sale signs?"
She said residents are selling houses under market value, which brings in less money in taxes.
Genther said some houses in Lake Hauto are in the Panther Valley School District and some are in the Tamaqua School District.
"The houses in Carbon County in Lake Hauto are not selling because of the Panther Valley School District," because of the difference in tax rates, she said.
Hunsicker said a two-mill increase will cover the expenses involved in a building project in which the swimming pool of the high school is being converted into classroom space.
He said he would not have voted for the building project had he known there wouldn't be enough tax revenue to cover this.
Regarding a proposed two-mill hike, Hunsicker said, "I'm a no, I'm telling you right now, on a two-mill or 2.5-mill increase."
The next major expense for the district will be a new roof on the elementary school, a project which could cost "upward of $1-million," Marx said.
The board is expected to vote on the proposed budget at 7 p.m. June 12 in the board room.