Saint Mary's Area reports $1.8 million operating surplus, board authorizes TRAN analysis amid state budget impasse
November 10, 2025 | Saint Marys Area SD, School Districts, Pennsylvania
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Saint Mary's Area School District reported a strong year-end position in its annual financial report but warned of continuing fiscal pressure from rising health insurance costs and shrinking federal aid.
Ginger Williams, presenting the district's annual financial report, told the board the district budgeted about $35.7 million in revenue and recorded about $35.8 million in actual revenue and roughly $33.9 million in expenditures, leaving roughly $1.8 million in revenue over expenditures. "So it was a very good position for us to be in," Williams said. She cited an ongoing health insurance overrun of about $576,000 in 2024–25, roughly 14.3% over budget, as a primary unexpected cost.
Williams summarized the revenue mix as about 55% local (primarily real‑estate and earned income taxes), 42% state, and 3% federal, and she described a notable decline in federal funding since 2020–21 (from roughly 7% of revenue to about 2%). "We didn't know that that was coming," she said, referring to the reduction in pandemic‑era federal funds.
On expenditures, Williams said salaries and benefits remain the largest lines (about 40% and 32%, respectively) and identified several categories that came in under budget, including supplies and substitutes. Capital spending over the prior three years included about $3.04 million in bond‑funded projects (high school front entrance, fire alarms, playground work, vans and roof work) and $1.3 million from capital reserves for items such as paving and architect fees.
Williams reported the district's cash position as of June 30, 2025, at about $16.3 million (including $2.7 million unassigned and $2.0 million in capital reserves) and said outstanding bond principal and interest through 2035–36 total roughly $7.8 million.
Because the state budget remained unsettled, Williams recommended the administration begin work with PFM Financial Advisors to analyze options and prepare for a possible tax revenue anticipation note (TRAN) to manage temporary cash shortages. "We are recommending that we begin working with PFM, our financial consultants, to do an analysis of our position and prepare for a possible tax revenue anticipation note," she said, adding that any borrowing would return to the board for approval.
Williams also flagged a statutory alternative under Pennsylvania law, citing Act 85 of 2016 and the Pennsylvania Department of Education (PDE) intercept process, which would allow the PDE to cover district debt service but would reduce future state subsidies to reimburse the state; the district would need to apply and meet PDE deadlines to qualify.
On operations, Williams said the food service program generated about $1.4 million in revenue with expenditures of roughly $1.3 million and a net of about $113,000. She also recommended continued planning for capital needs, noting the district expects to exhaust general fund balances by March without additional revenue.
At the meeting the board voted to authorize the administration to collaborate with PFM to explore a TRAN and approved a resolution to remain within the Act 1 index (4.4%) for 2026–27 real estate taxes. Board members clarified the Act 1 action does not itself approve a tax increase but preserves the district's ability to stay within the indexed limit if a future increase is proposed.
What happens next: The administration will work with PFM on an analysis and return with options to the board for any proposed short‑term borrowing. Any decision to issue debt would require separate board approval.
Ginger Williams, presenting the district's annual financial report, told the board the district budgeted about $35.7 million in revenue and recorded about $35.8 million in actual revenue and roughly $33.9 million in expenditures, leaving roughly $1.8 million in revenue over expenditures. "So it was a very good position for us to be in," Williams said. She cited an ongoing health insurance overrun of about $576,000 in 2024–25, roughly 14.3% over budget, as a primary unexpected cost.
Williams summarized the revenue mix as about 55% local (primarily real‑estate and earned income taxes), 42% state, and 3% federal, and she described a notable decline in federal funding since 2020–21 (from roughly 7% of revenue to about 2%). "We didn't know that that was coming," she said, referring to the reduction in pandemic‑era federal funds.
On expenditures, Williams said salaries and benefits remain the largest lines (about 40% and 32%, respectively) and identified several categories that came in under budget, including supplies and substitutes. Capital spending over the prior three years included about $3.04 million in bond‑funded projects (high school front entrance, fire alarms, playground work, vans and roof work) and $1.3 million from capital reserves for items such as paving and architect fees.
Williams reported the district's cash position as of June 30, 2025, at about $16.3 million (including $2.7 million unassigned and $2.0 million in capital reserves) and said outstanding bond principal and interest through 2035–36 total roughly $7.8 million.
Because the state budget remained unsettled, Williams recommended the administration begin work with PFM Financial Advisors to analyze options and prepare for a possible tax revenue anticipation note (TRAN) to manage temporary cash shortages. "We are recommending that we begin working with PFM, our financial consultants, to do an analysis of our position and prepare for a possible tax revenue anticipation note," she said, adding that any borrowing would return to the board for approval.
Williams also flagged a statutory alternative under Pennsylvania law, citing Act 85 of 2016 and the Pennsylvania Department of Education (PDE) intercept process, which would allow the PDE to cover district debt service but would reduce future state subsidies to reimburse the state; the district would need to apply and meet PDE deadlines to qualify.
On operations, Williams said the food service program generated about $1.4 million in revenue with expenditures of roughly $1.3 million and a net of about $113,000. She also recommended continued planning for capital needs, noting the district expects to exhaust general fund balances by March without additional revenue.
At the meeting the board voted to authorize the administration to collaborate with PFM to explore a TRAN and approved a resolution to remain within the Act 1 index (4.4%) for 2026–27 real estate taxes. Board members clarified the Act 1 action does not itself approve a tax increase but preserves the district's ability to stay within the indexed limit if a future increase is proposed.
What happens next: The administration will work with PFM on an analysis and return with options to the board for any proposed short‑term borrowing. Any decision to issue debt would require separate board approval.
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