Hampton Township School District adopts budget with tax increase

Hampton Township School Board unanimously voted June 12 to approve the district’s final 2023-24 general fund budget.

The adoption ushers in a 0.86-mill real estate tax increase, which is expected to generate an extra $1.56 million for the school district.

The rate will jump from 20.99 mills to 21.85 mills, or 4.1%, the maximum allowed for Hampton in accordance with the state calculated Act 1 index. Act 1 is Pennsylvania’s determination for calculating tax increases justified by wage inflation.

Under the new rate, the owner of a property assessed at the median value for Hampton, $171,400 as of this month, can expect an increase of approximately $147.

Just before the vote on the new budget, Bryant Wesley II, the board’s transportation chairperson, thanked fellow members for their dedication and hard work in making necessary cuts.

“I really appreciate the entire team sharpening their pencils and getting the budget done,” said Wesley, referring to a $120,696 reduction in expenditures that took place following a May 8 board meeting at which the budget was addressed.

In addition, anticipated revenues increased by $87,900.

“The cuts were made by trimming a little bit from everywhere, I think. They made some reductions to everyone’s budgets.” said Ed McKaveney, technology director at Hampton.

The school district is battling massive escalation in special education funding and increases in Public School Employee Retirement Services employer contribution rates, which has board members seeking ways to save money.

“As I always say, just because it’s in the budget doesn’t mean we have to spend it. We need to continue to look for cost cutting measures,” said Robert Shages, treasurer and legislative affairs chairperson.

One major factor that continues to strangle the district’s finances is the district’s PSERS obligation. In 2010-11, the contribution rate was 5.64% of members’ pensionable salaries, and it has continued to rise to 35.26% in 2022-23.

The rate has been approved at 34% for 2023-24, which offers some temporary relief, but actuarial projections forecast sustained rates of 34-38% indefinitely.

“We can’t control the rates. This isn’t just our district. This is a statewide problem for public schools,” said Jeff Klein, director of administrative services. “This is why we tried to be proactive when we started the stabilization fund.”

The fund was initiated during the 2009-10 fiscal year. It allocated $6.4 million toward future PSERS costs and included a plan to spread the money over 15 budget years. In 2020-21, the district adjusted and added to the fund. The updated Stabilization Fund had $2.719 million to allocate over seven years.

For 2023-23, the allocation is $400,000, which is going toward balancing the budget.

In addition to the PSERS rate increases, Hampton Township is facing a larger-than-normal increase in special education resources. The special education budget is up nearly 22% from 2022-23.

“This is a growing problem. We really don’t know why, but we talk to other administrators, and they are saying the same thing,” said Superintendent Michael Loughead

Despite the tax increase, some relief is available. The State Gaming Distribution for Tax Relief was approved on May 1 and will provide $1,082,871 to be divided evenly between Hampton’s 5,437 qualifying homesteads, providing roughly $199 of tax relief to each homeowner. Residents must apply for the homestead/farmstead exemption through Allegheny County’s Act 50 program.

Additionally, the Hampton Township School District Tax Relief Program includes $10,000 for the 2023-24 fiscal year. The program, designed specifically for senior citizens, has been updated to include adjusted income of up to $30,000 and offers property tax relief of up to $440. This program is available only to qualifying senior citizen homeowners who have applied for and received the rebate under the Commonwealth of PA Rebate Program.