Quakertown: $4.8 Million Shortfall

From the BCCT.

Has anyuone asked the Emperor yet what the 2009-10 budget looks like here at home?

How about the 2008-09 budget?

District budget facing $4.8 million shortfall
By: HILARY BENTMAN

Quakertown school board members got their first look at the 2009-10 budget and it's probably one they'd like to forget.

That's because the dismal economy and declining revenues have left the district $4.8 million in the hole.

The administration is recommending drawing $4.1 million in reserves down to zero to give officials time to make further cuts to not only balance the budget but build up the fund balance again.

"We can't have a budget with negative numbers," said Superintendent Lisa Andrejko.

Officials acknowledge starting with a zero fund balance is a scary proposition, particularly if the money can't be found to replenish the account.

After an early round of cuts, the district is looking at an $87.9 million preliminary budget, which is $3.4 million, or 4 percent, higher than the current $84.5 million budget.

Taxes will certainly increase next year; the question remains by how much.

Under a state-set cap, the district is allowed to increase taxes by 4.1 percent, or 5.14 mills, before seeking voter approval. For a home assessed at the district average of $28,800, that translates to a $148 tax increase, for a total bill of $3,762.

However, Quakertown can exceed this cap without voter permission through exceptions -ways for schools to disregard certain expenses in their budgets, such as construction, retirement and health care costs that contribute to the need for higher taxes.

With its allowable exceptions, Quakertown could raise taxes by about 4.59 percent, or 5.755 mills, which translates to a tax increase of $166, for a total bill of $3,780.

The district has fallen victim to the foundering economy.

Several major businesses within the district, including Lowes and Target, have succeeded in getting Bucks County to reassess their property values because of a decline in their worth. When a property's assessment value drops so does the amount of taxes the district generates.

The district has lost about $125,000 in revenue because of reassessments, said business manager Sylvia Lenz.

New construction in the district has also dropped off, along with home sales, hurting the amount collected in real estate transfer taxes. The district has also seen revenue from earned income tax increase by less than 1 percent, compared with the 3 percent to 5 percent increases seen in previous years, said Lenz.

As for the cuts the district will consider, no area is off the table. Everything from new and vacant staff positions, to technology, facility improvements, class electives and sports will be examined.

"Throughout every level we're going to see reductions," said Andrejko. "Every level is going to have some impact."

Officials will continue to work on the plan with a preliminary budget up for adoption on Feb. 12.