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Sto-Rox SD previews $7.5M in capital needs, recommends $5.8M transfer from fund balance
Summary
At a Sto-Rox SD board meeting, finance staff presented a preliminary 2026–27 budget showing roughly $7.5 million in outstanding capital projects and recommended transferring $5.8 million from unrestricted fund balance to the capital fund; the presentation also projected a 2026 shortfall just under $300,000 and noted the board does not plan to exceed the Act 1 index for next year’s millage.
Scott Reed, presenting the Sto-Rox SD preliminary 2026–27 budget, told the board that the district’s capital-improvement backlog includes about $7,500,000 in remaining projects — with the junior–senior high school among the most urgent needs — and recommended a $5,800,000 transfer from unrestricted fund balance into the capital fund to address health-and-safety work.
Reed said district enrollment measures (average daily membership and October 1 in-district counts) have trended downward and that, while state revenue estimates are currently steady, several expense pressures increase budget risk: an anticipated roughly 10% rise in health-care costs, charter tuition and transportation increases, and ongoing negotiations with the teachers’ collective-bargaining team. He told the board the district remains under PDE financial-recovery oversight: exiting recovery requires three consecutive years of positive fund balance followed by five years of monitoring. Reed noted Pennsylvania Department of Education policy limits unrestricted fund balance to a maximum of 8%; the local board policy target is to remain above 5%.
On tax policy, Reed walked the board through three millage scenarios — no change, a 0.5-mill increase and an Act 1-index increase — and displayed sample household impacts: roughly $2 a month, $4 a month and about $6.50 a month for different assessed-value examples. He said the board will set the final millage in June and that the pending resolution would keep any increase within the Act 1 index.
Reed’s preliminary expenditures slide showed projected revenues insufficient to cover 2026 expenditures, with a shortfall of just under $300,000 before factoring potential additional salary and benefit growth tied to the next contract. He said the administration is also pursuing updated cost quotes and grant opportunities and that much of the capital work would rely on the capital reserve (Fund 33).
During Q&A the chair asked who the presentation meant by “stakeholders.” Reed said the primary stakeholders in the budget-development process are internal budget managers and the finance/buildings-and-grounds committee. A committee member clarified that committee and financial-recovery meetings are open to the public and invited community input.
Next steps Reed outlined included continuing CBA negotiations, evaluating state and federal funding scenarios (including uncertainty around future Title I funding), updating the presentation for the March board meeting and providing monthly updates to the finance committee.
The presentation began at the public board meeting and will be revisited as the district refines revenue estimates and contract projections.
