Cheltenham SD finance committee reviews proposed 2026'27 budget with 3.5% Act 1 cap and $2.2M in tax-equity funds

Cheltenham SD's finance committee on April 7 reviewed interim financials through March and a proposed final budget for the 2026'27 school year that incorporates a 3.5% Act 1 tax index increase and $2.2 million in tax-equity funds.

Administration presented the general fund picture, noting a year-over-year drop in cash tied to an interfund payable to the capital reserve for the stadium project and timing differences caused by when large salary and insurance payments were processed. "We are to receive $2.2 million of tax equity money for the 2627 school year," administration said, adding that the money has already been received and is being held for next year rather than recognized as current revenue.

The presenter laid out revenue and expenditure summaries: about $125 million in year-to-date revenue collections versus $120 million last year and roughly $98 million in expenditures versus $95.7 million the prior year. Staff emphasized that some shifts are timing or grant-related rather than structural. Administration told the committee the proposed final budget has been increased from the February preliminary figure (about $106.3 million) to roughly $109.88 million because it budgets the maximum 3.5% Act 1 tax index increase into local revenue.

Despite those assumptions, the proposed final budget currently shows a $735,000 shortfall. Administration said that amount would be covered by the district's fund balance and reserves if the committee and full board proceed with the proposal. "We are using the $2 million of the tax equity money to balance the budget next year to avoid a tax increase," a board member paraphrased staff as saying during questions on revenue drivers.

Board members pressed administration on timing and what additional state subsidy increases might be available; staff cautioned that any phased increases in the state tax-equity supplement would be realized in later budget cycles and cannot be applied to the current adoption timeline. Staff also identified upcoming procedural steps: the proposed final budget will be posted to the district website and administration office for public inspection for more than 30 days before the scheduled final adoption on June 9, 2026.

Administration highlighted two major near-term uncertainties that will influence final staffing and costs: the April 15 deadline for retirement notices under the collective agreement and continuing enrollment declines in incoming kindergarten and first-grade cohorts, both of which affect net staffing needs. The presenter noted health-insurance premium growth has moderated to a projected 9.4% increase after stop-loss recoveries and other adjustments.

Next steps: staff will post the detailed proposed final budget for public inspection and return to the committee and full board ahead of the June 9 adoption vote. The committee did not take a formal vote on the proposed final budget at this meeting.