Updated: Survey of Pa. school officials predicts widespread staff cuts and property tax hikes

Poorest districts are affected most.

A survey of Pennsylvania superintendents and school business officials offers a bleak portrait of the state of education in the commonwealth.

With mandated costs growing faster than revenues, districts across the state report that they are planning to cut staff, increase class sizes, and curtail programs and extracurriculars — all while hiking local property taxes.

The Pennsylvania Association of School Administrators (PASA) and Pennsylvania Association of School Business Officials (PASBO) started conducting surveys of their members in 2010-11, as a way to document the effects of budget cuts.

This year’s survey offered “the worst outlook.”

“No one imagined that in all this time state policymakers would still have failed to take meaningful action to curb growing expenses or that the state share of school funding would still be declining,” said the report. “No one imagined that our school leaders would be losing confidence in state policy makers and students would still be losing learning opportunities.”

Seventy-one percent of Pennsylvania’s 500 school districts participated in the survey — at least one from every county. The student demographics of the participating districts mirror the state as a whole.

School officials say cuts and tax hikes are necessary to counter the fact that a growing share of their budgets are being eaten by mandated expenses.

“All districts’ projected increases in mandated expenses for pensions (100 percent), health care (84 percent), special education (88 percent), and charter schools (77 percent), higher in every category than in previous reports,” said the study.

Pension obligations have risen rapidly over the past few years as consequence of state policy decisions and too-sunny market projections.

This year, districts expect a staggering 24 percent increase in their pension payments.

“We’ve made it work the last six years but we’re at the end of the list of what we can do,” said Coudersport Area superintendent Alanna Huck, quoted in the report. “There’s a line in the sand and I don’t want to cut more from our kids.”

Payments to charter schools have also been rising steadily.

Bill Nichols, superintendent of Corry Area School District in Northwest Pa., says the cost of students leaving for cyber charters has been especially frustrating.

For every student who attends a non-district cyber, Corry Area pays over twice as much as it costs to educate a student in its own cyber program.

Nichols said cyber charter students often return to the district a few years later having fallen behind grade level.

“It’s as if we’re paying for them twice,” he said in the report, “once to attend a cyber and again to remediate when they rejoin our schools.”

The report estimates that on the whole the cost of mandated expenses will rise by more than $600 million in 2016-17, not including cost of living salary adjustments.

Forty-six percent of districts report they will cut staff before the 2016-17 school year. Thirty-four percent plan to increase class sizes. Fifty percent plan to cut academic programs and extracurriculars — with the state’s poorest districts affected most.

At the same time, more districts plan to raise property taxes this year than last year — jumping from 71 percent to 85 percent.

If enacted, PASA and PASBO say this will be the seventh consecutive year in which over 60 percent of school districts have raised property taxes.

Among districts planning tax increases, about 30 percent plan to tax above the Act 1 Index, which requires approval from the state or consensus through referendum.

Impasse effects

This year’s historically protracted budget impasse added to district stress and uncertainty.

Fourteen percent of districts needed to borrow additional funds, and 74 percent dipped into fund balances to make it through.

If the 2016-2017 budget is not approved on time, 34 percent of districts say they will again increase borrowing, and 83 percent say reserves would be further drained.

This year’s budget fight also affected districts that were counting on state reimbursement for construction projects through the “PlanCon” program.

Eighty-five percent of districts relied on payments for already approved PlanCon projects, but funds haven’t yet been distributed.

“Districts describe the paralyzing uncertainty of blind budgeting with little reassurance that next year’s revenues will be approved on time or prove adequate to offset rising expenses. Given this context, it’s no surprise that administrators are projecting continued cuts again next year,” said the report.

Governor Wolf is currently seeking a $350 million increase for state’s main pot of education cash in next year’s state budget.

“This report tells a story we already know. School districts across the state are still struggling and in many cases facing dire financial consequences,” said Wolf spokesman Jeffrey Sheridan.

Senate Republicans agreed. Spokeswoman Jenn Kocher emphasized her caucus’ focus on long-term pension reform.

“We have been saying for years that one of the biggest concerns is the pension issue, but there’s still this frustration that we can’t get a reform bill over the finish line,” she said.

Wolf and the majority of state senators reached a tentative agreement in December on a bill that would have reduced guaranteed pension benefits for newly hired state workers and school staffers. It faltered in the House without the support of any Democrats and many Republicans.

That bill, though, would not create short term savings.

Kocher would not commit to a dollar amount her caucus would like to see education funding boosted in this year’s budget.

Moving forward

This year, ending the impasse, Wolf allowed a budget with a $200 million increase in the basic education subsidy to become law without his signature.

PASA and PASBO asked districts to imagine a scenario in which a 2016-2017 budget was enacted with an additional $200 million.

Based on the cost of mandated expenses, school officials still offered a grim outlook.

“The vast majority of districts report they could not restore the cuts they have been forced to make since 2010,” said the report. “It’s basic math.”

The report lauded the state’s adoption, last week, of a student-weighted funding formula. But because lawmakers plan only to apply the formula to new increases in aid, for the state’s most distressed districts relief is still a long way off.

“We are excited at the prospect of planning for a sustainable future,” said Reading superintendent Khalid Mumin. “Without more money in the formula it will take 30 years for Reading to catch up. That window is just too long for our kids.”