PENNSBURY >> Pennsbury taxpayers won’t be paying as much in taxes in 2019-20 due to an $895,000 clerical error on the district’s tax resolution.
The district’s business manager Chris Berdnik revealed the error during the August Pennsbury School Board and finance committee meetings.
In June, the school board approved a final budget boosting the tax rate by 2.11 percent to pay for its budgetary expenses in 2019-20.
But when the signed tax resolution was sent to the district’s tax collectors, Berdnik said it listed the tax rate as 170.076 mills, which is a 1.51 percent increase instead of the 2.11 percent increase approved by the board. A 2.11 percent increase would have yielded a rate of 171.076 mills.
“I believe this was simply an error in typing ‘0’ when ‘1’ should have been,” said Berdnik, noting the document was prepared by the district’s interim business manager.
The good news for taxpayers is they won’t be digging as deep into their pockets to pay their school tax bill.
And fortunately for the district, Berdnik said the district will be able to make up much of the shortfall thanks to a better collection rate than anticipated by the budget and greater than expected assessed values in June, which boosts the value of mileage in the district.
“These two factors alone helped to offset the $895,000 missing revenue by about $400,000,” said Berdnik.
In addition, he said a July report from the county indicates an additional bump in assessed values that will generate about $300,000 more for the district than anticipated, bringing the anticipated shortfall to just under $200,000.
“We were very blessed with some good fortunate,” Berdnik told the finance committee. “We certainly lost that mileage, but the financial impact is somewhat mitigated. We have no recourse. Our tax rate is what was written into the resolution,” he said.
Board member Joshua Waldorf, who chairs the finance committee, said they will take a closer look at the numbers next spring and see where the district stands.
“It’s the beginning of the school year. It’s not time to slash our budget,” he said. “We, as a committee, maybe in April will need to look at it and say, ‘Okay. We’re not going to make that up. What’s the solution? Do we look at fund balance? Do we want to cut? Those are the things we need to be prepared for,” he said.
Berdnik has made a series of recommendations to the board to ensure that such a mistake won’t happen again.
Chief among them is for the board to decide on a tax rate in May and not wait until June to make that decision.
“You don’t need the drama in June,” said Superintendent Dr. William Gretzula. “You’re whittling all the way through the budget calendar. But to put it right up to the 11th hour in June is somewhat unnecessary. If you’ve done your job and you’ve done it well there should be no surprises. Everything is out there in May. All the documents are produced. Everyone has plenty of eyes on them.”
“And knowing the tax rate and finishing those details gives you the chance to have the actual Department of Education form in front of you so there is no mystery. The tax rate should agree with what’s in the resolution,” said Berdnik, who discovered the error when preparing the state form.
He also recommended that the general fund budget be prepared on PDE 2028, with the final version available the evening the budget is adopted.
“June 20th is too late to be exploring scenarios and simply have the right document exposed to board review and public exposure likely prevents this error, because the tax rate would be listed in the document,” said Berdnik. “This does not preclude additional usage of a more user-friendly document as is Pennsbury’s practice.”
Berdnik also recommended approval of an electronic document management system, which the board did at its August meeting in voting to purchase BoardDocs Light Version at a cost of $2,700.
“With BoardDocs, what is now a thick binder of material would all be accessible online, improving transparency and providing the board easier access to perform governance tasks, such as adopting a budget and setting a tax rate,” said Berdnik.