PSBA 2022 January/February Bulletin PSBA 2022 January/February Bulletin - Page 20

When setting a budget , school boards must carefully MATCH AVAILABLE RESOURCES to the planned educational goals for student success .
In Pennsylvania , newly elected school directors are required by law to complete five hours of training in areas including but not limited to school board governance , policy , school law and finance . Reelected school directors are required to complete three hours of training in similar areas . As an approved statewide provider of the required training , PSBA offers three ways to participate : in-person events , live virtual sessions or online courses at myPSBA . org . See the PSBA website for details on “ RQD ” or required training as well as a variety of professional development opportunities throughout the year .
Budget and finance : Balancing acts
Budgeting is arguably one of the most important responsibilities of the school board , and also one of the more complex functions . When setting a budget , school boards must carefully match available resources to the planned educational goals for student success . However , school finance is highly regulated . Many new school directors are surprised to learn just how much of a district ’ s budgeted costs are fixed through regulations and mandates ( pensions , existing debt , salary and benefits costs , charter school tuition payments and more ), and that much of the district ’ s revenue is outside of the board ’ s control . Furthermore , boards need to make key decisions about next school year ’ s budget early in the calendar year , yet districts often don ’ t have a full picture of what funding the state will provide until later . In order to make an informed decision , it ’ s important to understand what factors may affect budget decisions .
What money will schools receive from the state ? School districts receive Basic Education Funding that includes a base subsidy and an amount that distributes new dollars in the state budget using a formula that takes into account studentbased factors , including student count , poverty ,
English learners and charter school enrollment . The formula also includes school district-based factors which reflect school district wealth , local tax effort and capacity to raise local revenues . School districts can estimate what their state revenue will be by plugging their district ’ s numbers into this formula . Most school districts in the state receive less than half of their total funding from the state .
State funding for special education is based on another formula with weighted categories of support for students with disabilities . The formula , applied only to new money in the state budget , also includes factors reflecting community differences such as poverty , property tax levels , and rural and small district conditions . However , the state share of both basic and special education aid to school districts has failed to keep pace with the rising costs of providing these programs and services to students .
What other revenue does a school district receive ? School districts also receive local taxes , which fluctuate depending on the tax base . Because of the Act 1 index limit , a district cannot raise taxes above the index except for limited exceptions . Determining whether or not the board will be willing to raise taxes – and under what circumstances – should be discussed before decision-making time . That way , when the decision needs to be made , it can be done in a timely fashion . Another decision that should be considered is whether to reduce or eliminate certain programs if revenues decrease .
A district ’ s financial decisions can have an impact for years after they are made . Although balancing a school district budget is quite different from personal budgeting , talking with the district ’ s business manager or superintendent , as well as basic training in school finance , can help new school directors feel more prepared for budgetrelated discussions and decision-making .
Legal considerations : Staying in the sunshine
Pennsylvania Sunshine Act . Public Employee Relations Act . Pennsylvania Public Official and Employee Ethics Act . There are many laws and
18 PSBA Bulletin January / February 2022