Finance committee advances 2.9% proposed tax increase, flags $800,000 reliance on investment income

Mill Creek Township School District’s Finance and Operations Committee on April 7 voted to forward a proposed final 2025–26 budget that includes a 2.9% real‑estate tax increase to the full school board and recommended a resolution to designate portions of local revenue and investment income for extracurricular facility maintenance.

District finance staff said the proposed 2025–26 budget includes a range of expected increases: a roughly $1.8 million rise in health‑care costs, an approximately $962,000 transportation contract increase, $300,000 added debt service tied to recent borrowing, and $700,000 for custodial equipment. The finance presenter, identified in committee as Mr. O’Toole, told the committee the budget adds mandated positions and other personnel changes, and that the proposed tax adjustment equates to about $47 per $100,000 of assessed value.

The presenter warned the committee about a material risk in the proposal: it assumes roughly $800,000 in investment income will be available to help balance the budget. “We’re using $800,000 of investment income to balance our budget this year, which next year that 800,000 may not even be available to us,” Mr. O’Toole said, stressing that investment income is market‑dependent and can swing widely from year to year.

Separately, finance staff proposed a resolution to designate revenue generated from extracurricular participation fees, gate receipts, facility use fees, advertising revenue and 25% of investment income to a committed fund balance for the maintenance of extracurricular facilities. Staff said the change rescinds and replaces a 2018 board resolution and would shift the district’s prior practice of splitting investment income across multiple assigned balances to earmark 25% specifically for extracurricular facilities while incorporating other recurring costs into the structural budget.

When asked whether using investment income would reduce the district’s projected deficit, staff said the earmark would provide additional revenue that could offset operating shortfalls — one speaker estimated a potential effect of about $800,000 — but repeated that investment income levels are uncertain and tied to Federal Reserve policy and market conditions.

The committee voted to forward the proposed final budget at 2.9% to the April board meeting; members also approved forwarding the committed fund balance resolution for board consideration. Finance staff provided a five‑year forecast showing ongoing deficits under current assumptions and noted potential capital needs (including a turf/field project and an elementary addition) that could affect fund balance if paid in cash.