Finance

Overview: School District Finances

The Upper Darby School District’s 2012-2013 budget included total revenues of $156,396,763. Of these total budgeted revenues

  • $94,200,946 or 61.40% represent local revenue, including real estate. Real Estate taxes are going up this year by approx. 3.5%.
  • $54,308,401 or 35.4% represent state funding. Included in this amount are revenues for Local Property Tax Reduction in the amount of $5,141,702.
  • $6,069,416 or 4.0% represent Federal funding.
  • $1,818,000 or 1.2% represent proceeds from borrowings.

The budget included total expenditures of $160,396,763.

The remaining $4,000,000 budgeted shortfall was funded at the urging of the Governor, by a school board approved use of the District’s Fund Balance (or reserves) of approximately $7 million.

For the 2013-2014 Fiscal Year there will likely be another major budget shortfall.

The worst is yet to come

The important points:

  • The District, like many other districts across Pennsylvania, is losing tax revenue due to lower real estate values (tax appeals) and a slump in home sales (loss of transfer tax revenues). In addition, the District continues to incur higher special education costs, and the State has put policies in place that either reduce the funding for special education costs or do not allocate additional dollars to the districts most in need of it.
  • School Districts are facing much higher funding allocations for employee pension costs going forward. Contributions to State pension funds by school districts are mandated by the State according to a set formula, and a portion of District contributions are matched by the State. For many years now the State has been funding State pensions at a very low level. This was due in part to an assumption that the stock market would continue to grow at double digits. New governmental accounting rules established by the
    Governmental Accounting Standards Board (GASB), which will go into effect after June 30, 2014, will significantly alter the way governments account for their share of pension liabilities. Based on current projections these new accounting rules may, at least on paper, make most school districts appear insolvent.
  • The Upper Darby School District will not be able to use any more of their fund balance for the 2013-2014 Fiscal Year. If it does, it risks being designated a Financially Distressed School District by the Secretary of Education.
  • Charter schools—brick and mortar as well as Cyber-Charter Schools—are siphoning away funding from our public schools.
  • The wealthiest school districts get higher allocations of State funds, and the districts with the lowest incomes and the most diversity get much lower allocations of State funds.

The Upper Darby School District’s 2012-2013 Annual Budget Report

 

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