Abington Heights superintendent outlines budget timeline, signals possible tax increase tied to special-education costs

Dr. Schaeffer, superintendent of the Abington Heights School District, told the school board on Jan. 8 that the district will advertise a special meeting to hold an Act 34 hearing on Feb. 27 and will present a preliminary budget on Jan. 22 that could include a tax increase above the Act 1 index to cover rising special-education and health-care costs.

The superintendent said the board will advertise the special meeting on Feb. 5 and publish notice of intent to request Department of Education approval for an Act 1 referendum exception on Jan. 23. He said the district must submit the referendum-exception application by the state deadline of March 6. "I want to make sure I announce that in public," Dr. Schaeffer said about the Act 34 hearing, which the district will facilitate with its solicitor, the construction management firm and KCBA, the design firm.

The nut graf: The request to exceed the Act 1 index is being driven primarily by higher special-education enrollment and rising self-insured health-care costs, Dr. Schaeffer said. He presented district figures showing special-education enrollment increased from about 450 students in 2019 to 593 in 2023 (a 32% increase) and said special-education costs rose by $2,400,000 over the past six years (described in the presentation as roughly a 30% increase). State subsidies for education grew by about 13% in the same timeframe, which Dr. Schaeffer said does not fully close the gap for districts that rely heavily on local revenue.

Board members were told the district's Act 1 base index is 4.0%, a local poverty ratio increases Abington Heights's index to 4.7%, and the applicable referendum exception would add about 0.5 percentage point, yielding an exception-adjusted preliminary rate of about 5.2% (the superintendent said the preliminary budget could show a tax increase "perhaps as high as 5.2%" and that the final tax vote is in June). "This board doesn't have to approve that increase until June," Dr. Schaeffer said; preliminary votes only set markers for the administration and public review.

Dr. Schaeffer also described health-care cost pressures: district health-care costs rose by $1,670,000 over the past two years, the superintendent said, and the district is self-insured. He said current projections would require adding roughly $800,000 to the operating budget in the near term to replenish the district's insurance fund and avoid having to join a consortium. He explained the district's stop-loss insurance does not always fully offset claims and that an accumulation of large claims could erode the fund; he reported a recent fund balance around $4.5 million and a one-year loss of roughly $1.5 million.

The superintendent emphasized the timeline and legal steps the board must follow: an Act 34 hearing (required for certain construction projects under Pennsylvania law) will be held as a special meeting; the board will vote on a preliminary budget at the Jan. 22 regular meeting (after a public advertisement on Jan. 10), publish the notice seeking Department of Education approval of the referendum exception on Jan. 23, and submit the formal application by March 6. Final budget adoption and any tax-rate vote occur in June.

Board members asked clarifying questions about index calculations and fund balances during the presentation; Dr. Schaeffer and business manager Jim Mirabelli said they will present detailed numbers and a full preliminary-budget packet on Jan. 22. The superintendent said the administration would continue monitoring revenue markers such as earned income tax and additional budget data that arrive between January and June.

The board did not take action on the preliminary budget at the Jan. 8 meeting; the presentation was informational and set the timeline and next steps for formal votes in January and March (application) and the final adoption in June.

Ending: The school board's next regular meeting is scheduled for Jan. 22, when the administration will present the detailed preliminary budget and the board may vote to advertise a budget that includes a referendum-exception request to the Pennsylvania Department of Education.