The budget for the 2021-2022 school year is still showing a possible property tax increase of 4% for the Pleasant Valley School District.

Joseph Surridge, the district’s business manager, discussed the plan at the board meeting on Thursday.

He said he is still in the process of meeting with all of the department heads to go over their budgets.

He will bring it before the board again in May for passage of the proposed budget. Then in June, the school board will vote on the final budget.

“This is just a snapshot of kind of where we’ve moved from the preliminary (budget) to where we are now,” he said.

The district gets 56.7% in revenue from local sources, which includes property and transfer taxes, Surridge said. From the state, it gets 41.8% in subsidies, and 1.5% from the federal government.

Currently, the budget continues to show expenses projected at about $102.8 million. Revenue is projected to be about $99.1 million, leaving a deficit of about $3.7 million in the preliminary budget. With revised projections for cybercharter school funding, the deficit could increase to about $10 million, he said.

The school district is receiving funding through the Education Sciences Reform Act for the 2021-2022 school year in three grants of $634,000; $2.9 million; and $5.7 million.

The Pennsylvania Association of School Board Officials is advising school districts to use these funds wisely.

“We need to utilize that money with caution,” he said. “$5.7 million now, but there’s not going to be another $5.7 million next year. It’s not going to be another $5.7 million the year after.”

Surridge said there is a strong possibility that funding from the state will flatline as it deals with its own budget issues.

“The state may come back to us and say, ‘We can’t give you an increase because we can’t afford it and you got your ESRA 3 money,’?” he said.

A large portion of the district’s expenses are bound in contracts and agreements, such as salaries and employee benefits, which account for about 69% of the budget or more than $70.6 million.

Nearly 23% of its costs or about $23.4 million are in purchased services. The remaining costs of about $8.7 million are for supplies, property upkeep and other items.

“Much of the budget is fixed and we have very little discretionary numbers that we can avail ourselves to, and that’s an important thing to be aware of as we move forward,” Surridge said.

Charter schools continue to impact the school district both for this school year and the next.

Surridge said the school district is working on getting students to return to the school district. Since the district returned to in-person classes five days a week, 129 students have returned from other forms of education. According to the enrollment report, the district’s cyber academy lost 74 students, other cybercharter schools lost 49 students, and private schools saw a gain of five students.

District Superintendent Lee Lesisko is participating in talks with state officials regarding charter school tuition billing and Gov. Tom Wolf’s proposed tuition changes, Surridge said.

The district anticipates paying $4.8 million in cybercharter school costs between its own cyber academy and other cybercharter schools. The costs could increase to $11.7 million for next year.

In addition to charter schools, Surridge said COVID-19 expenses have hit the school district hard, and funding for the Pennsylvania School Employees’ Retirement System continues to be an “800-pound gorilla” on the back of all school districts.

The state requires school districts to contribute to PSERS. In 2002-2003, districts had to contribute 1.15%, but that has increased steadily over the years.

The increase grew at a steep incline between 2012-2013 and 2016-2017, then leveled off. For the 2021-2022 year, school districts are required to contribute 34.95%, or 35 cents on every dollar, to the retirement fund, Surridge said.

He said he kept being told over the years, “?‘Think how good you’ll feel when you get to the top of the hill and it levels off.’ I guess I’m there now, but I’m not sure how good I feel.”