A preliminary North-ampton Area School District budget for fiscal year 2014-15, calling for a 3.5 percent tax increase of 1.67 mills from 47.71 mills to 49.38 mills, was approved Monday night.

The NASD school board voted unanimously 9-0 to approve a preliminary general fund budget of $91,349,344, athletic fund of $173,569 and food service fund of $2,381,657.

The preliminary budget is now available for public inspection at least 20 days prior to adoption. Public notice of the board's intent to adopt the preliminary budget was given at least 10 days in advance. Pennsylvania school districts must approve budgets by July 1.

At the Jan. 27 board meeting, NASD Superintendent Joseph Kovalchik commented on the budget and tax increase.

"This is the preliminary budget. That number will come down," he said.

Kovalchik and NASD Business Administrator Terry Leh said several factors could help to lower the millage rate and tax increase percentage.

Pennsylvania Gov. Tom Corbett is to deliver his budget address Feb. 4 when district administrators statewide will learn of the level of Pennsylvania Department of Education (PDE) funding for school districts.

"We'll have somewhat of an understanding of where he's [Corbett] coming from," Kovalchik said.

"From what I've been hearing, the [state] budget's supposed to have more money," school board President David Gogel said.

"Last year, it [state education funding] was smoke and mirrors. They took away with one and gave with the other," board member Dr. Michael Baird said.

Kovalchik said another factor that could reduce the NASD tax increase is district staffing.

"We're not quite sure about retirements," Kovalchik said. "The teachers have until Feb. 1 to notify us [about retiring]." The 2014-15 budget calls for no new positions.

NASD had 700 employees during the 2011-12 school year. There are 646 employees during the 2012-13 school year.

The school board voted 8-1 to authorize the administration to request a referendum exception from PDE that would allow the district to exceed its 2.5 percent tax hike cap.

Board member Jean Rundle voted against the authorization.

Allowable PDE exceptions include those for reasons of construction costs and retirement contributions. NASD hopes to obtain PDE approval for its exceptions by April 14.

Kovalchik said at the Jan. 13 school board meeting when he and Leh introduced the preliminary budget that his goal is to get the preliminary budget's proposed 3.5 percent hike below the allowed 2.5 percent index.

The school board voted 8-1 to authorize the administration to advertise in a newspaper and on the district website its intent to seek the PDE exception.

If the NASD preliminary budget is approved with a 3.5 percent tax hike, a property owner's school tax bill would increase from $2,743.50 to $2,839.53 annually, or a yearly increase of $96.03, a monthly increase of $8 and a weekly increase of $1.85, based on the NASD average residential property assessment of $57,503.70.

With Leh projecting district revenue at $87,633,234, the 2014-15 deficit is $3,716,110, based on the preliminary budget of $91,349,344.

The budget commits $1,035,394 in funding for the new Northampton Area Middle School and Secondary Campus Renovation Project.

According to Leh and Kovalchik there are a few factors contributing to the NASD budget tax hike including $1.8 million set aside to contribute to the Pennsylvania Public School Employees' Retirement System; $750,000 increase in NASD employee health-care costs; increase in special education costs with no increase in state funding; charter and cyber school costs; and the new state-mandated Pupil Information Management System (PIMS).

The school board will hold its next meeting 6:30 p.m. Feb. 10 in the meeting room of the administration building, 2014 Laubach Avenue.