Chambersburg Area SD outlines $212 million spending plan, board signals higher tax path to shore up debt and capital

The Chambersburg Area School District on April 8 presented a proposed final 2025–26 budget projecting just over $209 million in revenue against $212 million in spending and a planned deficit near 2.9 percent.

The proposed budget, presented by business manager Diana Stauffer, also includes recurring interfund transfers the district has made in recent years — including transfers into healthcare, capital reserve and future debt-service funds — and a line item to continue the board’s “plus 1” strategy that parks a portion of annual tax increases for capital and debt needs.

Stauffer told the board, “we have a total revenue of just a little over $209,000,000. This is a milestone in that we broke the $200,000,000 mark, and our total expenditures will be $212,000,000.” She identified built-in cost drivers including projected pay increases, benefit increases and additional positions, and said the budget assumes a 98 percent collection rate and an Act 1 adjusted index of 5.3 percent.

Why it matters: The district is simultaneously planning for several large building projects, and board members and staff described a need to balance near-term operating pressures with ongoing efforts to accumulate recurring revenue for future debt-service payments.

Administrators proposed keeping the structure of the current approach — a modest operating tax increase plus a recurring “plus x” transfer that grows the capital and debt-service funds — but several board members pushed for a higher operating adjustment than the 2 percent the administration had used for planning. Board discussion focused on two linked choices: (1) how much of next year’s tax rate should fund operations, and (2) how much should be reserved to build recurring debt-service capacity ahead of planned borrowings.

Financial adviser John Fry of Public Financial Management (PFM) briefed the board on borrowing timing and affordability. Fry said the district is considering phased borrowing to support multiple projects and noted a short-term plan to issue a relatively small, bank-qualified borrowing of roughly $10 million this fall to begin architect and design work and to manage interest-rate risk.

Board direction: After wide-ranging discussion about conservatism in budgeting and the need to pre-fund debt-service obligations, board members asked staff to prepare the final budget for board approval in June with a higher operating increase than the staff’s draft. Business manager Diana Stauffer summarized the change: “I’m hearing build a 3% budget to bring in as the final budget,” and to reduce the initially planned automatic capital transfer in 2025–26 from $4,500,000 to $2,000,000 while maintaining additional debt-service funding. The board did not record a formal roll-call vote on the floor that night; staff were directed to present revised numbers at the next meeting.

Budget details and clarifications presented at the meeting - Projected 2025–26 revenues: just over $209,000,000 (Stauffer) - Projected 2025–26 expenditures: approximately $212,000,000 (Stauffer) - Forecasted operating deficit (before adjustments): about 2.9 percent of the budget (Stauffer) - Assigned and committed fund balances were discussed as sources to smooth shortfalls; staff described a committed fund balance earmarked for taxpayer relief of roughly $9 million and an assigned fund balance in the tens of millions. - Interfund transfers already completed this fiscal year, as presented by staff, included about $3,500,000 to healthcare, $4,000,000 to capital reserve and $4,000,000 to future debt service. Stauffer and board members emphasized these transfers and future choices are subject to final audited results and board approval.

What’s next: Staff will revise the proposed final budget to reflect the board’s direction, circulate updated numbers before the May display period and return in June with a final budget for adoption. The board also asked staff and PFM to refine multi-year projections for debt service and to model the effect of the higher operating increase on the district’s long-term glide path for borrowing and capital work.

Ending: The district is balancing near-term operating pressures against a multiyear debt plan that would increase debt-service payments over the next several years; board members signaled they prefer a slightly higher operating increase in 2025–26 to preserve capacity for capital and debt needs while maintaining conservative reserves.