MUNCY - Muncy School Board members unanimously passed a no-tax-increase 2013-14 preliminary budget during their meeting Monday evening.
The budget holds the line on taxes while including projects from last year that were delayed because of financial restraints, explained David Edkin, district business manager. The final budget will be adopted June 18.
"I feel fortunate we are in the situation we are," Edkin said, noting other school districts in the state have had to cut positions and furlough employees due to lack of funding.
The $15.1 million budget takes into account rising health insurance premiums and retirement costs the district faces, Edkin said.
"We feel good to address these issues and not raise taxes," he said.
The district will even be able to move forward with projects that were put on hold.
"A lot of stuff that was gutted in last year's (budget) is in this year's," he said.
Edkin pointed out that previous staff cuts and the fact that the district is not in a renovation or building project helped keep finances stable.
"Those two things really helped us," said Edkin.
Superintendent Dr. Portia Brandt said those cuts that occurred about five years ago, were from retirements and attrition.
"We trimmed the all of the fat," Brandt said. "We did due diligence along the way."
She added that the cuts were not made out of monetary considerations at the time.
The district's taxes remain at 13 mills real estate; 1.25 percent earned income; 0.5 percent real estate transfer and $5 local services. A house valued at $100,000 would generate about $400 in real estate tax from the millage rate.
Board members also heard from Brian Sanker, senior managing consultant at PFM Asset Management in Harrisburg. Sanker said the district has an opportunity to place funds designated for future retiree obligations in investments that may generate more revenue than being held in money markets or certificate of deposits.
While Edkin reserves amounts for such use now, he is limited in how he can invest funds, he said. Sanker's firm would manage the district's money in a trust along with hundreds of other school districts in the state.
The district would have a say in how much is put in its account and what investment portfolio to choose. Sanker said an average return of 7 percent is not out of the question.
The funds are designed to grow over a longer period with a greater potential for return, according to Sanker. However, money put in would be subject to risks with the stock market.
"You do have some risks with this. On the other hand, hopefully it will grow over time," Sanker said.
Still, Sanker said his company sees a bullish market during the next five years.
"Why not go the step extra and put that liability in a trust?" he said of the district's future payouts. "This is a way to keep up with rising health insurance costs."
