New Kensington-Arnold sees growing tax base, no tax rate increase in proposed 2024-25 budget

The New Kensington-­Arnold School District expects tax revenues to increase next year despite having no plans to raise taxes.

The district’s proposed $45.5 million budget keeps taxes flat and would not take advantage of one of the highest state Act 1 indexes in years — 8%. The inflation-based index is the percentage the district is allowed to raise taxes without seeking voter approval in a referendum.

The district is expecting its property tax revenue for next school year to increase by about $306,000. That’s because of a $3.5 million increase in the district’s assessed property value, from $123.4 million to $126.9 million, according to a presentation by business manager Jeff McVey.

The district expects revenue from real estate taxes to increase by 3.2%, from $9.3 million projected in the current school year’s budget to $9.6 million in next school year’s budget. That assumes a tax collection rate of 89%.

Total local revenue would increase by 2.3%, from about $13 million to $13.3 million, which also includes earned income, per capita, real estate and local services taxes; delinquent tax collection; local grant programs; and miscellaneous revenue and fees.

As proposed, the district’s property tax rate would remain at 97.64 mills. It was last increased by about 1.6%, from 96.14 mills to 97.64 mills, for the current school year.

School board President Tim Beckes said budget discussions will continue. The board must approve a proposed final budget by the end of May and the final budget by the end of June.

“The board continues to work hard to put the district into a position that allows us to reinvest back into the schools and students, support programs and facilities improvements,” Beckes said. “All of this is done with a goal of improving our students’ experience and academic outcomes.”

While New Kensington Mayor Tom Guzzo frequently touts the city’s revitalization — from new small retail businesses along its Fifth Avenue corridor to industrial operations in the manufacturing park spanning the city and Arnold — he placed credit for the district’s finances with the school board “being very diligent and looking at all responsible cost-saving measures in their budget planning.”

“I am certainly hopeful that the expansion of our tax base with the addition of all of the new businesses in our continued revitalization is playing a role, as that is one of the desired outcomes.”

In addition to more local tax revenue without a tax increase, the proposed 2024-25 budget also includes a nearly $713,000 surplus. It projects total revenue of $46.2 million while spending $45.5 million.

That would increase the district’s fund balance to about $6.1 million. The district has shown surpluses its last four school years; the last deficit, about $270,000, was in 2019-20.

The district’s total projected revenue and spending are each down by about 10% over the current school year, largely because of the end of covid-related federal funding.

The budget shows the district’s state revenue increasing 6.2%, from $28.7 million to $30.5 million. Federal funding will fall by about 75%, from $9.8 million to $2.4 million, due mostly to the end of covid-19 pandemic recovery funding.

The school board next meets at 7 p.m. Tuesday, April 9, at Valley High School.