COAL TOWNSHIP - Kindergarten and other elementary programs face possible elimination in the Shamokin Area School District as it confronts a $4.6 million budget shortfall.
An estimated 25 professional and non-professional positions could also be eliminated, some through attrition.
Projected revenues for 2012-13 total $27.5 million while expenditures are at $32.1 million, leaving school board directors the unenviable task of making up the difference.
A significant tax hike is off the table, at least without voter referendum, although the district may have its first property tax increase in 20 years. That leaves slashing costs and dipping further into reserve funding.
State law doesn't allow for individual teaching positions to be eliminated due to financial hardship; however, it does allow for the elimination of programs deemed "non-essential."
That's what's being considered at Shamokin Area on the elementary level as kindergarten, music, art and physical education are each being looked at as potential losses.
Sources say if the latter three programs were cut, elementary teachers would be asked to incorporate elements of the three into their lesson plans.
There are 10 kindergarten teachers for the 185 students enrolled last fall. It's estimated cutting the program would save $800,000.
The threat of the elimination of kindergarten is reminiscent of last year's decision to drop K-4. But in a unexpected turnabout, directors reinstated K-4 ahead of the 2011-12 school year, paying for the program with funds alternative to that of the general fund.
It's not clear if kindergarten could be saved through such a maneuver if a decision to cut the program comes to pass.
Already $1 million cut
The proposed 2012-13 budget had totaled $33,174,348.80. That was reduced by more than $1 million when administrators cut expenditures, including $588,173 on textbooks and general supplies, along with $347,734 in equipment.
In fact, while more than $1.6 million remains allocated toward general supplies and textbooks, all equipment purchases have been dropped.
Those cuts left board members with a budget totaling $32,164,027, still well past the district's anticipated revenue of $27,545,263.
Aside from the idea to cut kindergarten, other ideas under consideration include seeking a $500,000 pay freeze - a proposal employee unions would have to agree on - and the use of $700,000 from the existing fund balance - a balance that's projected to total $2.8 million when the current school year ends June 30.
Sources say, if instituted, a pay freeze - withholding a salary increase until the following year - would do little outside of passing the burden onto the next budget.
It's possible board directors could ask union employees to forgo a raise altogether for one year.
Staff cuts
Sources say between 15 and 20 teaching positions or teachers' aides positions, or a combination of both, could be eliminated through cuts and retirements. Elimination of five to 10 custodial positions are also being considered, as are cuts to security staff.
The current starting teacher's salary in the district is approximately $28,000, and the average for 2011-12 is $45,238.79.
There is talk of seasoned teachers and staff being offered early retirement incentive plans. There is also talk of reducing the number of district staff designated as administrators; however, their jobs would most likely be retained.
The administrator tag brings with it higher salary and benefits. By reducing the number of staff designated as administrators - there are currently 12 - savings could be realized.
Another position that could be cut is that of school resource officer.
Last month, the district's contract with Coal Township police to provide a school resource officer was not renewed.
The board had been paying 70 percent of a designated officer's salary and benefits to patrol the hallways of district buildings. The current officer assigned to Shamokin Area is Patrolman Chris Lapotsky. Of his $81,840.08 in annual salary and benefits, the district would have been responsible for $57,288.05.
However, it appears directors will at least reconsider whether or not to keep a township officer in its district.
Salaries across the board at the district - from regular teachers to support staff and beyond - are estimated at $12,459,053 in 2012-13, up slightly at $135,274.
Employee benefits, however, are expected to rise dramatically, totaling $6,526,812 and up $1,042,826, due in large part to increases in retirement contributions and tuition and health reimbursements.
Contracts with the Shamokin Area Education Association and with employees belonging to the American Federation of State, County and Municipal Employees expire at the end of the 2012-13 school year.
Property tax hike
The board is seeking a hike in property taxes in line with state law, meaning it can't raise taxes greater than the rate of inflation without seeking voter referendum.
It would be the first increase for Shamokin Area since 1992.
The current property tax rate is 25.75 mills and generates about $2.2 million in revenue when considering the district's collection rate of 85 percent.
The highest the board of directors can raise taxes this year is 2.6 percent, or 0.6695 mills. The proposed new rate would be 26.4195 mills and create $63,920 in new revenue.
The board could seek exceptions to the restrictions on the allowable tax increase, but it's been indicated that they wouldn't be of much benefit. There's been no indication that directors would seek referendum, either.
State allocations
When Gov. Tom Corbett took office last year, he pushed through extensive budget cuts to state education funding. That put many of Pennsylvania's public school districts in tougher fiscal predicaments and Shamokin Area was no exception.
In 2010-11, it received $17.7 million from state revenue sources. That number was slashed by almost $1.7 million for the current school year to $16 million.
It's expected the allocation will remain about the same for the upcoming year, with the district budgeting for just over $16 million, including $11.8 million in the basic education subsidy, up 2 percent from last year. However, the possibility that state revenue will again be slashed is not out of the question.
The district has long sounded the alarm about its fiscal infirmities for 2012-13. Faced with a $4 million deficit in 2011-12, the district used money from its existing fund balance to make up the difference. That's out of the question this time around, acknowledged as such by Superintendent James Zack last April when he spoke about the district's "difficult position" for 2012-13.
That language and dialogue regarding the anticipated budget deficit has continued since then, and it's been said that Zack has spoken with employees of all department in the district about the pending predicament and potential repercussions.
The board meets at 7 p.m. Wednesday, where it is expected to adopt a preliminary budget in accordance to state guidelines. The preliminary budget will appear as balanced, but by no means will it go unchanged when the final budget is due at June's end.
Anticipated Revenues for Shamokin Area School District
Source 2011-12 2012-13
Local 9,924.784 9,826,704
State 16,042,800 16,124,101
Federal 1,594,458 1,594,458
Proposed Preliminary Expenditures
Type 2011-12 2012-13
Salaries $12,323,784 $12,459,058
Benefits $5,483,986 $6,526,812
Professional services $5,914,685 $5,883,334
Other services/tuition $4,114,976 $4,079,843
General supplies/books $2,236,805 $1,648,632
Equipment $347,734 $0
Dues/fees/debt $222,301 $326,115
Budgetary reserve $31,836,636 $32,164,027