Christie Steigerwalt, business administrator, provided a slide presentation update on the proposed 2025-2026 budget at the April 16 Northwestern Lehigh School Board meeting.

“This budget summary is just our April update. It’s just a quick update on some line items that’s changed since our presentation in March,” she said. “We had a slight decrease in our salaries and benefits. This number will continue to change as we get numbers for some line items or if we receive any notices from staff on leaves for retirement other than teachers that would be eligible for retirement severance.”

Steigerwalt said that district wide, the budget will be changing once the fuel bid is awarded and the insurance policy pricing received, both by May 1.

“The revenue number is slightly up due to the monthly update just on the assessed values of the district, so the total expenditures for March is down $87,901. Our total revenues for March are up slightly by $18,232 so the shortfall before any tax increase from March is down $106,000,” she said. “Millage options that are out there.”

A 4% tax increase, the maximum allowed by state law, would generate approximately $1.3 million and the impact to an average taxpayer would be an addition of $176.88 to their tax bill.

With that increase, the district would have an estimated fund balance of $1.7 million, she said.

A 3% tax increase would generate approximately $1,000,000 in revenues with an impact to the taxpayer of $132. 66. That would leave a fund balance of $2.1 million.

An 2% tax increase would generate an estimated revenue of $686,000 with an estimated increase to the taxpayer of $88.42 and the estimated fund balance of $2.4 million.

Steigerwalt reminded everyone that the taxpayer impact does not reflect any reduction a taxpayer would receive from the gambling funds the district received from the state or homestead farmstead relief. For this current school year, a taxpayer who received homestead farmstead relief had a deduction of $239.66 for homestead and $30.98 for farmstead.”

She then provided a forecast estimating the mileage increase if the board would consider going to the Act 1 Index each year for the next three years.

She said she projected this out by increasing the expenditures over each year by an average of 5 to 6% and increased the real estate tax revenue by the percentage received for that percent increase.

“So this is extreme since I’m not increasing any other revenue sources the district may get for the next three years,” she said.

Her projections show a $1.7 million tax increase for 2024-25 and a potential end of the year fund balance of $18.6 million.

A 4% Act 1 Index increase in 2025-26 would generate an additional $1.3 million and provide a projected fund balance at the end of June of $16.8 million.

She said the 2026-27 projected Act 1 Index right now is 3.6% which could potentially generate approximately $1.2 million revenue. Using the 5 to 6% average increase for expenditures and the revenue increase of just the tax mileage, the district would be looking at a $4.6 million shortfall.

With the projected 3.6% tax increase, the district would have to use $3.3 million from the fund balance.

“At the end of 2027, our fund balance would be approximately $13 million,” she said. “Then in 2027-28, the projected Act 1 Index is 3.2% which could generate approximately $1.1 million.

With her projected expenditures and revenues, the shortfall would be $6.9 million.

“We would have to use approximately $5.7 of fund balance,” she said. “So at the end of 2028, potentially our fund balance could be down to $7.7 million.”

Steigerwalt said for the next two weeks she is going to be preparing the proposed final budget for the May board workshop, and then the following week, she would have the approved proposed final budget for the board meeting.

“As I’m preparing the final budget and going with the 4%, if you would like me to project something different, something lower for an increase, I can do that,” she said.

The proposed final budget is not set in stone. and changes can be made at the last minute.

“It’s just a matter of how much money will colonize in the fund balances,” she said.

“This is just proposed; the final doesn’t dictate anything that’s going to happen effective July 1. Stuff can still be changed for the June board meeting.”