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Daniel Boone School Board President Andrew Basile said Nov. 12 that the district’s 2013-14 budget deficit is estimated to be $5 million.
He said the deficit will be balanced with the maximum amount tax increase of 1.2534 mills with two exceptions (the state’s pension fund, PSERS, and special education), programs reduction that will include 27.5 staff positions, and using $1.4 million of the district’s $2.6 million unassigned fund balance.
“That is unless we enter into contract negotiations,” said Basile, adding, “A lot needs to be refined - of what the state will provide. The tax base is pretty much the same. We also need to determine if our assumptions are accurate.”
Superintendent Dr. Gary L. Otto said revenues are flat this year at $50 million, expenses are estimated to be $55 million with district salaries at $1.5 million, benefits at $1.7 million, and professional service costs at $300,000.
He said 70 percent of the budget gap is salaries and benefits.
“Balancing the budget will require all of the parties to come to the table,” said Basile, adding that the board would attempt to schedule a budget workshop in December.
“There are some discussions with programming I’d prefer not to have, but we have to do this,” said Otto.
There were no comments or questions from the public.
In other business:
The board unanimously approved the resignation of Brad Gross, art teacher at the Amity Intermediate Center.Gross was also president of the district’s teacher’s union, the Daniel Boone Education Association.
Otto said DBEA Vice President Amy Hicks, eighth grade reading teacher, will likely lead the DBEA.
The board also unanimously approved renewing Otto’s contract for a three-year term.
“In spite of the many financial difficulties, it truly has been my privilege and honor to serve this community as the superintendent,” said Otto. “Thank you for your confidence in me as we move along in the next three-and-a-half years. I aim to preserve the integrity of the district’s programs.”
Linda S. Himeback, partner with Herbein & Company, Reading, delivered the district’s annual audit report.
Himeback said there were no findings or deficiencies with the district’s internal controls or with the audit results.
She said the district’s annual payroll amount of $23 million, which is now a $59 million pension liability, will be reflected on the district’s financial statements within two years.
“Every school district in Pennsylvania is going to have a negative net asset number,” said Himeback. “We don’t know what it will mean for bond ratings, but will look at the trend of the school district. We don’t have any control over it but we will need to book it. The rate will not drop at any point unless they change the legislation.”
Himeback said the state’s total PSERS liability is estimated to be $30 billion.