BUDGET PROCESS AND TIMELINE:
Each of the 500 school districts in the state of Pennsylvania is required to develop and adopt a district budget following ACT 1 of 2006. Act 1 of 2006 requires the Board of School Directors of each district to approve a preliminary budget 110 days before the primary elections of that year to determine if a referendum question will be necessary to raise adequate revenue to balance the upcoming year’s budget or adopt a resolution to accelerate the budget and not exceed taxes above the index.
The Board is also required to approve a proposed final budget 30 days before the adoption of the final budget. Budgets must be approved by June 30th of the prior school year. Section 24 PS 6-687 requires that budget documents be available for public inspection during the 30-day period. Upon Board approval, budgets must be filed with the Pennsylvania Department of Education within 30 days of the adoption. The budget process is continuous, the work begins in September of each year when the Pennsylvania Department of Education releases the ACT 1 index.
The day-to-day operations of the district are accounted for under the district General Fund. Expenditures cannot exceed the budget by function and object. Budgets are in effect beginning July 1 and ending on June 30th. Once the school board of directors has adopted the budget, the second phase of the budget process begins. The District administers and manages the budget by entering a line-item budget into the financial software and putting controls into place that prevent over-expenditures on any line item. Budget transfers between line items are allowed beginning October 1st of each fiscal year. Each month for Board meetings a report is prepared showing actual expenditures and projected expenditures compared to the budget.
The Base Act 1 Index is published by the Pennsylvania Department of Education and is the state-mandated limit for real estate tax increases unless exceptions are utilized or voter approval is given to raise taxes above the index. If the Board of Directors adopts a resolution that it will not need to raise taxes above the state-mandated limit, it can forgo the adoption of the preliminary budget.
The Commonwealth of Pennsylvania mandates that no school district with a budget between $18,000,000 and $18,999,999 shall approve an increase in real property taxes unless it has adopted a budget that includes an estimated unassigned fund balance less than or equal to 8.5% of budgeted expenditures. In future years, it is possible, that the District will be limited to 8% if expenditures and revenues increase. York Suburban School District Board Policy adopts this maximum fund balance limitation.
The board policies that provide guidance for the development and implementation of the annual budget can be found under the school board section on the district website www.yssd.org.