Jim Thorpe Area School District is contemplating a 4% tax increase to address a projected budget shortfall of approximately $3.2 million for the 2025-26 fiscal year.

While Jim Thorpe hasn’t raised property taxes in almost 15 years, Superintendent Robert Presley said during a committee meeting Wednesday night that continuing to hold the line could be negatively affecting the amount of state funding the district receives.

“Over the last 10 years our property value has gone way up, our average income level has gone up, and our poverty level has gone down,” Presley said. “So what the state does in its formula, when you start putting those things in there, there’s a percentage that comes out at the end. And our percentage of funding has dropped every single year because the state is saying based on these factors you have the ability to raise local funds. But because you are not raising local funds, we are not going to continue to fund you at a high level.”

Presley said Jim Thorpe is losing the second most amount of funding in the state based on that formula.

“We’re losing $273,000,” he said. “The only district losing more is the city of Pittsburgh.”

Board President Mary Figura emphasized the importance of communicating the actual impact of the proposed 4% tax increase to the public.

She said that nearly half of the district’s taxpayers would see an increase of $7 or less on their bill after homestead/farmstead property tax rebates.

“I think it’s very important that people understand that and we do everything we can to get that message out to the taxpayers,” Figura said.

Many low-income homeowners, Presley added, may still see a lower property tax bill than last year because homestead/farmstead rebates are also increasing.

Board members emphasized that failing to raise taxes could result in more significant financial challenges in the future.

Figura warned that without an increase, the district could face a severe budget crisis within the next few years.

“If we don’t raise taxes, we could basically, by 2028-29, not have any fund balance remaining,” she said.

According to the district’s “2025-26 Budget Comparison” document, total expenditures for the upcoming school year are projected at $53,154,999. With no tax increase, projected revenues would be $49,928,749, leaving a budget shortfall of $3,226,250. With the proposed 4% tax increase, revenues would rise to $51,146,413, reducing the shortfall to $2,008,586.

The district’s fund balance is estimated to be $14,110,566 at the end of June 2025. Without a tax increase, it would drop to $10,884,316 by June 2026. With the 4% tax increase, the estimated fund balance would be $12,101,980.

“I know everybody is in tough times with how everything is going up,” Figura said. “I think we really need to show that we’re still trying to be fiscally responsible, and by doing this 4% increase, we’re helping to get more money from the state. We’re getting people their money back. And we’re hopefully not going to be bankrupt in several years.”

The meeting also revealed changes to real estate tax assessments that impact the district’s revenue.

“We are projected to see a slight decrease in the real estate tax revenue based on the total assessment of our property going down,” Business Manager Brian Off said. “We had two major tax appeal settlements that went through that actually decreased the gross assessed value of all our property.”

The district is also contending with uncertainties in state funding, as Pennsylvania’s budget has not yet been finalized.

“The governor’s budget is not going to go through the way it is,” Presley said. “So the cyber change that he’s requesting is not going to go through. He’s looking for an $8,000 flat fee for regular education students and that’s not happening. What I’m hearing is $11,000 or $12,000, which isn’t a ton of savings for us.”

Regarding cyber charter school funding reform, Presley noted: “A lot of savings is on the special education side, where they need to do a tiered system.”

“We need something done with truancy for cyber school students,” he added. “We need something done with registration. I’m currently chasing families down that I know don’t live in this district, but we’re paying for them.”

Jim Thorpe will vote on a proposed final budget next week with a final budget vote scheduled for June.

“The proposed final budget will include the 4% increase,” Presley said. “The board can always back that down in June but it can’t go any higher than what is in the proposed final budget.”