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District finance update: fund balance, state budget uncertainty and tax-index note
Summary
Business officers told the board the district expects an audited fund balance in December and that preliminary results show a roughly $1.34 million deficit impact attributable to committed capital reserves; staff said unassigned reserves remain adequate by policy and that uncertainty persists while the state budget is unsettled.
Haverford Township School District finance staff presented a budget update Sept. 4 showing preliminary year‑end figures and guidance for the 2025–26 budget cycle.
The district reported it began fiscal 2024–25 with a fund balance of about $19.84 million and, before audit, expects to close the year at roughly $18.5 million. Finance staff characterized the net movement as a roughly $1,341,000 deficit impact driven in part by capital commitments (capital projects reserved in fund balance). Officials said the unassigned fund balance is largely unchanged and remains in a range that meets district policy targets; staff estimated unassigned reserves provide about 24.9 days of operating expenditures on hand (district daily spending estimated at about $436,000).
Finance staff cautioned that the state had not adopted a full budget at the time of the meeting, leaving basic education, special education, transportation and retirement reimbursements not yet received; the district has, however, received property‑tax relief payments and is about 86% collected on tax revenue, which staff said provides short‑term stability. The presentation noted Pennsylvania’s certified base index for 2025–26 is 3.5%; that index would yield less revenue than the 4% index used in the current budget and would translate to approximately $581,000 less revenue than a 4% increase on the district’s tax base, staff said.
Board members asked for clarification about use of fund balance to support capital projects and whether transfers have been used to adopt budgets in prior years; finance staff said favorable operational variances helped avoid heavy reliance on unassigned fund balance this year but cautioned that reductions in reserves would constrain future flexibility and could force bond financing for some capital items if reserves decline further. Auditors are expected to present draft audit numbers in December, and the board will accept the audited financial statements at a later action meeting, staff said.
