The Avon Grove School Board and district administrators held a committee-of-the-whole budget work session on May 12, the latest in a series of meetings as the school district works on the spending plan for the 2020-2021 school year.

Like school districts across Pennsylvania, Avon Grove is grappling with the various impacts that the coronavirus outbreak has had on schools, including the closing of school buildings since mid-March. The crisis has not only altered financial projections for the 2020-2021 school year, it has already affected revenues and expenditures for the current school year.

Dan Carsley, the district’s chief financial officer, offered a thorough review of Avon Grove’s revenues for the current school year, as well as an update on revenue projections for the 2020-2021 school year.

As Carsley began his presentation, he commented on the large number of budgetary changes that can be directly attributed to the coronavirus pandemic.

“There have been a lot of [budgetary] adjustments since April,” Carsley said. He explained that the district has seen expenses decrease somewhat since schools closed. The school district’s costs for Chester County Intermediate Unit services declined, building maintenance costs are less, and district officials are also negotiating with the transportation companies to work out a deal on those costs.

Superintendent Dr. Christopher Marchese noted that while the district has been closed for normal operations, Act 13 legislation passed by the Pennsylvania General Assembly in late March requires school districts to maintain payrolls and certain district operations so that education could continue for students.

The biggest task during the closure was to transform learning environments from traditional school classrooms to online learning initiatives. As a result, Avon Grove—like all school districts in Pennsylvania—encountered many unforeseen expenses in the area of technology and operations. 

In a press release issued by the school district, it was noted that,  since mid-March, Avon Grove has supplied ChromeBooks to 583 students, Internet hotspots to 63 students, and an additional 53 hotspot units being delivered to students within the next week. The school district’s food services division has prepared and distributed approximately 45,000 meals to the community. These are just a few examples of initiatives undertaken by the administration, the teachers, and support staff to ensure that students remain engaged in the learning process for the remainder of the school year.

Marchese emphasized during the committee-of-the-whole meeting that Avon Grove will not be operating with a revenue surplus for the 2019-2020 school year just because COVID-19 prompted school buildings to close and curbed many activities that regularly take place.

Carsley explained that there remains a great deal of uncertainty regarding both local and state revenues, especially for the 2020-2021 school year.

The administration is scaling back revenue projections for 2020-2021 to be consistent with trends in collected revenues during the Great Recession that occurred in fiscal years of 2009 through 2011, when the percentage of local real estate taxes collected declined overall as a result of the economic hardships that residents and business owners were facing at the time. The district’s main source of revenue comes from local sources, primarily local property taxes, Carsley noted.

He explained that by scaling back revenue projections to the collection levels of 2009 to 2011, the district’s projected revenues decline from about $94.8 million to around $93.1 million.

In addition to local revenues, the district also receives a considerable amount of revenues from the state. In the proposed state budget that was released three months ago, state funding for schools was expected to increase slightly. Pennsylvania, like all states, has seen the coronavirus pandemic severely impact its budget. A final state budget for 2020-2021 hasn’t been adopted yet, so school district officials are uncertain about the level of funding from the state.

With projected revenues on the decline, Avon Grove must make spending cuts or face a larger budget shortfall. For the 2020-2021 school year, Avon Grove’s administration has already been at work reducing costs, but projected expenses are still increasing overall year to year. 

Carsley said that the administration has asked the staff to go back and look at ways to find some further reductions in expenditures. 

The budget plan for 2020-2021 currently includes a tax increase of 3.5 percent, which is close to the Act 1 Index limit for Avon Grove for that school year.

Marchese said that the administration still believes the best course is to keep the tax increase at 3.5 percent, especially with the uncertainty for what will be required to support the learning environment post-COVID-19. A tax increase at the level of 3.5 percent would limit the school district’s need to dip further into its cash reserves in support of general school district operations and would also provide protection if revenues are less than projected.

Marchese said that while he understands why several school board members have expressed concerns about still increasing taxes by the Act 1 Index limit, there are long-term ramifications to the school district budget that could lead to painful cuts in the future, including possible reductions that have serious impacts on instruction.

District officials are, however, continuing to work on reducing expenses for 2020-2021.

“You’re asking us to tighten the belts and that is what we’re doing,” Marchese said.

School board president Bill Wood noted that an extra budget work session has now been planned for Tuesday, May 26 so that district officials can continue to work through the various budget issues. This meeting is open to the public and residents can offer public comments in advance and can “attend” the virtual meeting while it takes place. Information about how to submit public comments and participate in the meetings can be found on the board of directors page of the school district’s website at avongrove .org. Recordings of previous meetings are also available on the website.

The Avon Grove School Board is on track to adopt a final budget for 2020-2021 at the June 4 school board meeting. Carsley did say, however, that he has had discussions with Marchese about possibly delaying the adoption of a final budget until later in June because there is so much uncertainty about the state budget.