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Derry Area School District adopts $44.0 million budget, keeps millage at 91.8 mills
Summary
The Derry Area School District board adopted the final 2025–26 budget of $44,027,220, assigned $2 million for capital projects and kept the district millage at 91.8 mills. Board members discussed fund balances, staffing changes and enrollment trends during a lengthy presentation by Mr. Chapel.
The Derry Area School District board on Thursday approved the districtfinal budget for the 202526ndash;26 school year, adopting total expenditures of $44,027,220 while keeping the tax rate at 91.8 mills.
Mr. Chapel presented the budget and said the final budget represents a 1.7% increase from 202425, driven primarily by salaries and benefits. "Your salaries and benefits total overall is approximately 61% of your budget," Chapel said during his presentation.
The board also voted to assign $2,000,000 of unassigned fund balance for future capital projects, and to retain approximately $3,600,000 in unassigned fund balance (about 30 days of expenditures) to meet cash-flow needs. Chapel said the districtis projecting state revenue growth of about 4.3% from 202425 and that federal pandemic-era ARP/ESSER funds have expired for the district.
Why it matters: The budget sets spending and the districttax impact for the year that begins July 1. The boardkept millage steady after several years without an increase, while directing reserves toward capital needs such as roofs, paving and vehicles.
Key details: Chapel said the district will transfer $1,500,000 to the capital projects fund in the coming year and that the final budget increase over tentative was about $156,000, mainly to add one kindergarten teacher and to reflect administrative adjustments. He noted enrollment trends show a projected decline over several years and that the district is monitoring staffing and program changes accordingly.
Board action and vote: The motion to approve the final budget was moved and seconded and approved by roll call (6 yes, 0 no). The board separately passed a resolution levying millage at 91.8 mills under the Pennsylvania School Code of 1949 (roll call: 6 yes, 0 no). The motion to assign $2,000,000 in fund balance for future capital projects passed on voice vote.
Context: Chapel reviewed revenue sources, noting local revenues decreased slightly because more state gaming (homestead/farmstead) funds are passed through to taxpayers. Federal revenue rebounded relative to earlier conservative estimates after allocations were released, leaving only a small net federal decline for 202526ndash;26. Chapel said the district did not fund recurring positions with one-time federal dollars and that debt-service obligations include a bond that matures Oct. 1, 2027.
Board members praised the administration for fiscal management but acknowledged continuing constraints. "It has been quite the process as any budget is," said one board member during discussion.
Looking ahead: The board directed continued monitoring of state budget developments and federal program funding and said capital planning and an investment-grade audit will inform any future borrowing or renovation projects.
