Charter school expenditures figure to be a major cost driver in Lehighton Area School District’s 2021-22 budget, administrators said during a finance committee presentation Monday night.

In the wake of the COVID-19 pandemic, Lehighton’s charter school costs went from $1.42 million for the entire 2019-20 fiscal year, which ends June 30, to $1.88 million through February 2021.

“We’re projecting the 2021-22 charter school expenditure to be around $3.11 million,” Business Administrator Edward Rarick said. “That’s a 119% increase.”

Lehighton currently has 206 students enrolled in outside cyber­charter schools and 214 students in its in-house Lehighton Area Virtual Academy.

Part of Gov. Tom Wolf’s state budget plan is a tweaked funding formula, however, that would drop Lehighton’s charter tuition to $1.05 million.

“This is not just an obstacle that Lehighton faces,” Rarick said. “I have heard some horror stories from other districts with cyber expenditures in excess of $5 million per year.”

According to Rarick’s budget presentation, Lehighton is currently estimating $43.56 million in expenditures versus $42.36 million in revenue for 2021-22, leaving a $1.2 million deficit.

“How we balance the budget is not solely my decision,” Rarick said. “The student should continue to be the baseline for all decision making. We can’t continue to cut programs and resources such as technology, curriculum, supplies, textbooks, athletics and social/emotional support that provide the necessary building blocks for our students to become vibrant and successful contributors to society.”

The proposed budget represents a 3.2% increase over 2019-20 actual expenditures. Decreases are projected for administration, construction improvements, the business office and pupil personnel, while increases are forecast for special education and technology.

“Upgrades to existing technology equipment will be covered, in many cases, by federal stimulus money,” Rarick said.

A breakout shows 63% of the expenditures are made up by salary and benefits; 7% by contracted professional services such as with the Carbon Lehigh Intermediate Unit 21, Behavioral Health Associates, audit and legal expenses, etc.; 16% by other purchased services such as student transportation, insurance and charter school tuition; 6% by debt service payments and contingency for contract negotiations; and 4.5% by other expenditures.

In addition to charter school costs, contributions to the Public School Employees’ Retirement System continue to be a large cost driver come budget time. Rarick said even if salaries stayed flat for the next six years, PSERS contributions would have a gross increase of $1.89 million during the same time.

Federal stimulus money will be coming into the district, but when will it arrive and what will it be used on?

According to Rarick, only $300,000 is arriving this fiscal year, with $2.7 million coming in 2021-22, $2.9 million in 2022-23 and $700,000 in 2023-24.

“We’ve been very cautious with how we look at this,” Rarick said. “We could have said we’re getting all this stimulus money and made the financial picture look really good, but we do have a structural deficit as has been pointed out in several audits. If we just mask it with one-time money, we’re not showing the true picture.”

Districts are being encouraged to use the money on one-time expenses such as technology upgrades and ways to combat the learning loss that many students felt during the pandemic.

“We are looking at technology and curriculum,” Rarick said. “This isn’t something where you want to go out and add 15 teachers with this stimulus money, because three years from now you’d have to figure out how to keep paying for it.”