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Northern Lebanon SD staff present tentative 2025-26 budget showing $1.8 million shortfall; proposes 2.75% tax increase
Summary
District finance staff told the school board the tentative 2025-26 budget assumes a 2.75% real-estate tax increase, a $10 million beginning fund-balance estimate and a projected $1.8 million deficit driven by rising bond payments, salaries and charter-school costs.
Leanne, a district finance staff member, told the Northern Lebanon School District Board of Directors on April 8 that the tentative 2025-26 budget proposal assumes a 2.75% real-estate tax increase and shows a projected deficit of about $1,800,000.
"The budget numbers that I'm presenting tonight are based on the 2.75% tax increase," Leanne said. She told the board she will use an estimated $10,000,000 ending fund balance carried forward from 2024-25 when preparing the formal PDE budget submission.
The nut graf: The proposed budget relies on the tax increase and an available ending fund balance to cover a gap created by rising fixed costs, chiefly higher bond payments, salaries and charter-school tuition. The board will adopt a proposed final budget in May and the final budget in June; the district must submit the final budget to the Pennsylvania Department of Education (PDE) within 15 days of adoption and no later than July 15.
Leanne presented revenue and expense line items for 2025-26. With the 2.75% tax increase and a flat state funding assumption, the presentation showed roughly $50,800,000 in recurring revenue and $52,600,000 in expenses, producing the roughly $1.8 million deficit. Real-estate taxes represented the largest single revenue source (about 52% of recurring revenue), with other local sources (earned-income tax and real-estate transfer tax) bringing local funding to roughly 62% of the budget.
On expenses, Leanne highlighted that salaries, benefits and bond payments together account for about $37,000,000 or roughly 71% of the expense budget. She said bond payments increased about $600,000 this year and that next year the district will pay about $6,100,000 in bond debt service. Charter-school tuition was shown in the budget at roughly $3,200,000 for 2025-26. One-time capital items listed included tennis-court resurfacing estimated at $320,000 and a set of athletics and equipment purchases just over $100,000.
Leanne told the board the $1.8 million withdrawal from the ending fund balance already includes the planned $300,000 from capital-project reserves for the tennis-court resurfacing. She said the district expected one more year of significantly higher bond payments and that administrators would continue trimming expenses and monitoring state funding levels for possible changes in June.
Dr. Messinger previewed a separate facility item in May — MedEd work at the high school — and said the district will communicate schedule impacts to families before the break.
The board was given the district's budget timeline: adopt a proposed final budget in May, adopt the final budget in June and submit to PDE by mid-July. Leanne said staff will provide a two-page budget synopsis and an updated 10-year forecast to board members before the May vote.
Ending: Board members asked no substantive questions at the April meeting; the board will consider the formal proposed budget in May and the district will publish the PDE form and supporting documents for public inspection as required by state procedure.
