The Montoursville Area School Board is dealing with difficult decisions with next year’s spending plan.

And hiking taxes would only partly fill an $836,000 deficit the district is now facing with the budget.

Business Manager Jessica Reich reported to the board at its recent meeting that a 1% real estate millage tax increase would increase revenues by $151,000 to lower the shortfall to $685,000.

A 2% tax hike would bring in $303,000 in revenues, decreasing the deficit to $533,000. A 4% tax increase would mean $598,000 in revenues to further lower the deficit.

That 4% increase, raising the district’s overall millage rate from 17.09 to 17.84, is the maximum figure allowed by the district under the Act 1 index, according to Reich. With the average assessed value of a property in the district at $121,000, real estate taxes would increase $91 next year.

This year’s $35.8 million spending plan did not include a tax hike.

Reich noted that the district has seen a gradual increase in the millage rate from 2009 when it stood at 12.72 to the present figure of 17.09.

By comparison, South Williamsport School District’s millage rate is at 19.35, the highest among all Lycoming County schools. Loyalsock School District’s 15.35 millage rate is the lowest.

“You can see we are pretty much in the middle,” she said.

Another option for lowering the deficit would mean tapping the fund balance now at $4.9 million.

Montoursville Superintendent Dan Taormina said the projected budget at this point does not reflect precise state revenue allocations for the district.

The board is expected to approve the final budget in June.