Lehighton Area School District’s board of directors approved a $51.5 million budget Monday night that raises property taxes 3.5%, but not before a board member challenged the vote’s legality and moved to delay it.

The 6-3 vote set revenues at $51,443,380 against expenditures of $51,512,855 and moved the property tax rate to 53.6751 mills from the current 51.86.

Board members David Bradley, Joy Beers and Jeremy Glaush voted no.

For the median homeowner, whose property is assessed at $46,200, the annual tax bill before exclusions rises to $2,479.79. The 4,290 homeowners who qualify for the homestead and farmstead exclusion will have $9,260 in assessed value knocked off that figure, reducing the bill after exclusion to roughly $1,985.

Budget trimmed until the end

Before the board took up the budget itself, Superintendent Jason Moser used his report to walk through what changed between the May proposed budget and the document before the board Monday. He said the gap had narrowed from two directions.

“The early retirement incentive certainly paid dividends in terms of narrowing that deficit,” Moser said, adding that administrators had also cut departmental and building budgets by an average of between 1.5 and 2% across the board. “We have gone back and sharpened our pencils and really kind of drilled down, put out a pretty significant challenge, and we were able to move some things around, defer some things, replace some things with an alternate plan without taking anything away from our students.”

Combined, he said those reductions came to approximately $608,000.

He then presented a six-year revenue chart to explain why the district’s finances have grown increasingly strained even as it held tax increases to a historical average of roughly 1%. The picture he drew was of a district that grew dependent on pandemic-era federal education dollars that have since dried up.

Federal revenues peaked at more than $3.5 million in the 2023-24 school year, buoyed by ESSER III relief funding, alongside more than $21 million from the state; what Moser called “kind of a high water year in terms of revenues.”

By the following year, federal revenues had fallen by more than $2.5 million. State funding rose by a similar amount that year through adequacy funding, offsetting the drop. But this year’s budget carries only $843,000 in federal revenue, and state funding has seen only a minor increase.

“The tea leaves are that the big bust in state funding is probably not happening anymore,” Moser said. “When you’re losing that amount of revenue coming off the books over a course of several years, it poses a great challenge.”

He noted that neighboring school districts are confronting the same cliff.

“There are neighboring school districts who have had to look seriously at furloughs; they are looking at increases in tax revenues,” Moser said.

The cost side of the ledger, he said, offers no relief.

“Our costs do not go down, whether that’s utilities, whether that’s maintenance, whether that’s supplies. What cost $1 in 2020 now costs $1.28,” Moser said.

He acknowledged directly that pandemic-era revenues had masked the structural problem.

“Our revenue sources were inflated during these years because of the federal government. There is no doubt about that. Were our professional staffing numbers inflated as well? I actually would say yes,” Moser said, adding that the district is working to right-size those costs in tandem with reducing outside student placements.

“I’m a firm believer that you cannot simply tax your way out of any financial problem. That will not solve the problem. I think you have to look at every potentially useful lever that you have.”

Business Administrator Matthew Lentz added that state funding uncertainty makes planning harder than ever.

“As we sit here on June 22, this is the fifth year in a row we don’t have a clear direction on the state budget,” Lentz said, noting that unannounced grants and allocations can shift district finances in ways that are impossible to forecast.

Move to delay fails

Bradley moved to table the budget for five days, saying the board could find $400,000 in savings and deliver a zero tax increase.

“Why are we increasing the taxes when it’s only $400,000?” Bradley said. “We have millions of dollars sitting in the bank. Why not just use the money we already have? You already took it from them.”

Only Beers joined him in voting yes on the tabling motion.

Bradley then argued the final vote was premature under Section 687 of the Pennsylvania School Code, which he said requires 30 days between the posting of a proposed budget and approval of the final budget. The board’s solicitor, Attorney Beth Shore, said the requirement applies to when the proposed budget is prepared and made available, not to when it is voted on.

“The proposed budget needs to be posted at least 20 days and it needs to be prepared at least 30 days in advance,” Shore said.

District officials said the proposed budget was posted May 22 — 31 days before Monday’s meeting — satisfying that standard.

2025-26 budget transfer

The board voted 6-3 earlier in the meeting to assign just over $1 million of the district’s fund balance to cover Behavioral Health Alliance student services costs that exceeded this year’s budget — a move Bradley, Beers and Glaush also opposed.

Moser said the move was a matter of accuracy.

“It’s disingenuous to the public in terms of the total amount that’s in (the fund balance),” Moser said. “It’s disingenuous to the board to say we’re looking for a tax raise when we have 8.5% sitting there, when we know we aren’t going to have 8.5% sitting there. So the efforts were made to actually present a more accurate picture of the financial status of the district at the current time.”

Under state law, districts over $19 million in expenditures may not carry an unassigned fund balance exceeding 8% of total expenditures while raising property taxes. The budget’s own certification page shows the district’s ending unassigned fund balance at $3,487,007 — 6.76% of expenditures — after the BHA assignment. The beginning unassigned fund balance was $4,573,578.

Bradley also questioned the budget’s format, saying some line items were blank and the board was being asked to sign off without adequate detail.

“I think you’re rubber-stamping something that doesn’t need to be done,” Bradley said.

Reduction a bad move

Resident Barbara Bowes placed the tax increase in historical context, arguing it flows directly from a decision the prior board majority made last year to cut taxes by one mill.

“If we had not reduced taxes by one mill last year, there would be no reason to have a tax hike this year at all,” Bowes said. “Last year we lost $354,626 with that.”

Even with the 3.5% increase, Bowes said, the district has not fully recouped that revenue.

“You’re still short by almost $66,000,” she added. “Do I want to pay more taxes? No. I just want to get back to where we were before money was thrown around to buy votes or make the new board look bad because they have to raise taxes.”

The budget carries roughly $47.3 million in long-term debt as of June 30, projected to fall to $45.3 million by the end of the coming fiscal year as bond payments continue. The district’s total assessed value stands at $403,161,966.