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Centennial Looking at Tax Raise, Teacher Cuts to Close Budget Gap

The school district will apply for exceptions that allow school taxes to rise past the Act 1 index. The elementary school consolidations will translate into staffing reductions.

Facing a $3 million gap in the 2012-2013 budget, Centennial officials have placed higher tax rates and staff reductions on the table to balance the ledger.

Prior to Tuesday night's finance committee meeting, Berdnik posted what he calls an "armageddon" projection of staffing cuts, a worst case scenario that sees the district shedding 60 positions. He says that the final number is highly unlikely, but with the consolidation of Stackpole to the new and Longstreth to , teacher and support staff cuts are inevitable.

"If I had to cut right now to make the budget work, it would be about 35 positions," said Berdnik, figuring a $4 million deficit divided by an average $120,000 salary + benefit teacher expense.

Salary, benefits and contributions to the Public School Employees' Retirement System (PSERS) account for approximately 70 percent of Centennial's budget. Since the PSERS expenditure is a percentage mandated by the state, the most impactful spending cuts come from teacher/support staff salaries and benefits.

Berdnik has worked to reduce spending in other categories, including several of the 500 recommendations made by the Pennsylvania Association of School Business Officials (PASBO). The push for more efficiencies in day-to-day operations creates pocket change when compared to the sizable dent that teacher cuts would make.

The challenge for Berdnik and the rest of the school district is ensuring that the educational value for the students does not diminish from the cuts. The findings presented tonight at 7 p.m. by the ad hoc committee on class sizes will be taken into consideration during the decision-making process.

The 2012-2013 revenue projections anticipate a tax increase of 1.7 percent, or 1.93 mills, adhering to the Act 1 requirements. Berdnik will also apply for two Act 1 exceptions that add an additional 2.37 mills, or a total tax increase of 3.79%. A mill equals a dollar tax on every $1,000 of assessed property value.

The Pennsylvania Department of Education (PDE) allows districts to apply for exceptions to Act 1 tax requirements in four instances:

  1. Grandfathered debt from school construction: If there is outstanding debts for school construction projects.
  2. Electoral debt from school construction: Costs associated with paying principal and interest on any voter-approved debt, qualify for an exception.
  3. Special education expenditures: If a portion of a special education cost increase exceeds the district’s special education state funding.
  4. Retirement contributions: If a school district’s increase in the amount of the estimated payments for PSERS between the current year and the upcoming year, as determined by PDE, is greater than the index.

The two that Centennial plans to adopt are the grandfathered debt and retirement contributions.

According to state requirements, the district must apply for the exceptions by Feb. 2. Requesting the exceptions does not mean they are automatically enacted; the school board still needs to vote on whether to pull that lever. However, Berdnik has baked in the additional $1.2 million of revenue generated by the exceptions, meaning if they are not implemented, the $3.3 million deficit grows to $4 million.

Berdnik says that pending sources of revenue have not been added to the budget, mainly from real estate transactions. State rquirements mandate that revenue from building sales must go toward either debt payments or capital projects.

The paperwork for the approved $300,000 sale of the Dorothy Henry Satellite School to Ivyland Borough has yet to be finalized. Berdnik says that a good offer has been made for the property, but he won't disclose the amount or the buyer until it is presented to the school board. The school board also has to give final approval to put the and properties on the market. Berdnik expects that vote to occur at the Jan. 24 meeting.

warmama January 26, 2012 at 09:03 PM
Mr. Krenshaw, If that is the case, then can you explain to me why they renovated Willow Dale instead of building a new building? I'm not asking to be argumentative. I really want to understand why they chose to renovate Willow Dale and double it's population while building new buildings to replace the other schools.
Pete Krenshaw January 26, 2012 at 09:22 PM
warmama, that is a good question. I believe the argument at the time was the building itself was mostly there and compliant with current codes and regulations. They took unused basement space in one wing and finished it into classrooms, digging out the courtyard to allow for windows to be installed. I don't know the extent of the renovations in the remainder of the building. Just that the "core" of the facility was solid and worth keeping/renovating. Davis Elem. on the other hand was built much earlier with timber construction making it cost prohibitive to retrofit. Finally, looking at McDonald, one would see a very "solid" building but the configuration is so different with the "pods" that it was felt they could not offer similar programs as the other two elem schools. This is what I remember from the presentations and previously published news articles. I believe one of the main points was to equalize what was offered throughout the district so no one school had an advantage over another. From what I remember, other objectives were to consolidate classroom space (older buildings had rooms with larger area then new buildings and the ratios were off for SF/student/classroom), reduce cost of core facilities/staff (much of the cost of a school is in the "common space" of the library, cafe, and admin - so reduce the number of schools and reduce the number of admin/staff to run it all) and update the facilities to modern standards. Maybe others remember more details?
Pete Krenshaw January 26, 2012 at 09:28 PM
At the end of the day it was about money - but to be able to obtain more bang for the buck. Obviously the administration and the board has changed over several times since this plan was initiated. Apparently, somewhere along the way things went off the tracks and it seems we are ending up with the worst of it all. Grossly mismanaged design/construction and ill conceived plans for execution. Instead of improving the quality of education we appear to be jamming as many kids into a building as possible, reducing the quality of education through less teachers and less programs. Just look at the high school where they are now considering discontinuing romantic languages and technical oriented classes... When will it end?
warmama January 27, 2012 at 11:21 PM
I don't know. There were problems 17 years ago when my first entered the district schools. I have watched it get worse and worse as time goes by. I am happy not to have any children left in the grade schools and middle schools, and hope that my last in high school can make it to graduation before it gets much worse. In the last board meeting, there was discussion of saving money on computers if students brought their own computers to school. Then, as one board member commented, they would be responsible for the upkeep of their own computers. I don't know about anyone else, but there is no way I am sending my kid to school with a laptop so it can be stolen or vandalized by another student.
Pete Krenshaw January 28, 2012 at 04:23 AM
I would have to agree with you on that idea... I wouldn't be sending my kid in with a computer just so it can get destroyed. Apparently all options are on the table. One thing is clear, changes need to be made. The way things have been going is unacceptable and unsustainable. Let's hope it can get back on track sooner rather then later.

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