Octorara Eyeing Up 3.2% Property Tax Increase

Octorara Eyeing Up 3.2% Property Tax Increase

The Octorara Area Board of Directors and Finance Committee met on Monday, December 12, 2016. Eight Board members were in attendance. Hank Olejniczak was absent.

Board member absenteeism is a big pet peeve for me. It is something I mentioned privately to Board leadership about this time last year. There were several members of the previous Board that (to me) seemed over the top. In fact, one member, for two consecutive years, knowingly scheduled family vacations when the Board was voting on the budget,,, arguably the most important vote made. This year, I am taking it upon myself to make public the most egregious attendance violator… Hank Olejniczak

  • RS 12/12/2016
  • WS 11/12/2016
  • RS 10/17/2016
  • WS 09/12/2016
  • WS 06/13/2016
  • RS 05/16/2016
  • RS 04/18/2016
  • RS 02/23/2016

Mr. Olejniczak missed 8 of the 23 Board meetings (35%) and corresponding committee meetings. Within those numbers, 5 of 12 Regular Sessions (roughly 41% of voting meetings) were missed. Moreover, Olejniczak could have potentially lost his Board position under 24 P.S. 319 for missing two consecutive Regular Sessions, but the law is a bit vague in defining a “necessary absence”. However, while the law empowers the Board to remove someone like Olejniczak, who has an outrageous record for missing meetings, it does not seem to necessarily compel a vote. It all really comes down to the discretion of Board leadership to make it an issue.

Therefore, since friends don’t vote friends off the Board, it is up to voters to decide if absenteeism is a real issue. Regardless, the only way to know if your Board Members are showing up to meetings is by meticulous tracking absenteeism on your own. There is no reporting mechanism in place to inform taxpayers and the general public of a Board Member’s attendance record. You need to pick through each month’s meeting minutes and chart each them individually.

Hank Oleyniczak is up for re-election this year in Region 2.

The 2016 Audit

Once again, Herbein + Company, Inc. completed their audit of the District’s financial statements and compliance with internal controls. There is not much new information. We discussed many of the big issues regarding the 2015-2016 Budget last month. However, there are some points worth noting.

The 2015-2016 school year ended with a surplus of $648,954. This was a direct result of roughly $700,000 of debt cost savings and $500,000 of an owed but unplanned PlanCon reimbursement, This is around $1.2 million of non-reoccurring credits. This is $1.2 million that could have just as easily not been there, and caused a significant deficit, cutting deep into the District’s Reserve. This is also $1.2 million that we have not thoroughly addressed.

However, the auditors did provide high praise to Jeff Curtis and his team for creating an Internal Service Fund and the Capital Reserve Fund. Those who follow this blog know that I have given Mr. Curtis kudos for many of the changes he has made since becoming Octorara’s Business Manager. He is a forward thinker who understands the need for long-range financial planning. I don’t always agree with him, but he is reasonable and rational in his approach.

The 2016-2017 Update

In June, the Board passed a Budget with roughly $537,800 in cuts, a $1 million deficit, and a $316,883 anticipated use of Fund Balance. Projections are showing we are going to receive $585,738 in debt service saving and another $633,814 in other expenditure savings. On the revenue side, local revenue is looking up by $198,817, but State revenue is down by $168,780 and Federal revenue is down $316,319. All in all, the current forecast is an anticipated use of Fund Balance of $73,613.

The 2017-2018 Budget Process

The Board received some initial numbers for the 2017-2018 Budget. Before getting into those numbers, there are some things I should reiterate. First is while you can watch the presentation on The Cube, most of the real detail and conversation surrounding it was at the Finance Committee Meeting. This is how it is going to be from now until the Budget vote in June. If you want to know what is really being discussed, demand those meetings be recorded.

Second, you will hear some Board Members start talking about how this is a process and there is nothing anyone should worry about this early. WRONG!! This is just an attempt to keep you out of the process. Just like cutting the Librarian last year, they will tell you “no decision has been made”. Then, when you finally do speak out, it is too late. So, keep that in mind.

2017-18 Budget Highlights

  • What the Board was shown was a 2017-18 Budget of $53,605,175, an increase of over $1.7 million.
  • The numbers also assume a 3.132% tax increase in Chester County and a 3.411% tax increase in Lancaster County.
  • This assumed property tax increase will raise $1 million in revenue.
  • However, despite all sources increasing revenue by $1.4 million (this includes the above property tax increase), the budget will still have a deficit of $1.2 million.
  • Because of the Budget Contingency and anticipated Debt Service Savings, there is an anticipated use of Fund Balance of $577.285.

I know, some of you are asking, “Why is the deficit still so high and higher than last year?” It all goes back to our discussion about the 2016 Audit, and an issue I have been trying to bring to the public’s attention for years. The Board has, for a very long time, relied on non-reoccurring credits to help pay for the growth in the budget. These kinds of credits have lasted way longer than most would have ever expected, but they are going away.

The District has benefited from a very slow U.S. economy and historically low interest rates. They have been able to repeatedly refinance their debt, saving hundreds of thousands of dollars within any given budget. It was a way to kick the can, and avoid making the hard choices. However, this is an issue that every Board Member knew existed when they voted on new spending programs, like the armed security guard and the iPad program. They never wanted to discuss it, but they all knew we were surviving on borrowed time.

During the meeting, Brian Norris asked what only half tax increase would look like. The answer is a $1.7 million deficit and a $1 million use of Fund Balance. However, if you watched last night’s meeting, you don’t see any questions about ways to cut the budget so that we don’t need another tax increase, or even limiting it to something less than taxing up to the Act 1 limit. At this point last year, there was already serious talk about making cuts.(Read this year’s so-called discussion about building consolidation here.)  That doesn’t mean cuts won’t happen this year, but I would not hold my breath about there being any serious effort.

As I have pointed out before, the cuts in the 2016-17 budget were about doing the least amount possible, and truly did not address the long-range financial issues facing the Octorara Area School District.  Before I was on the Board, I banged my fist during Visitor Comments stating that the District was on the path to reach 40 mills before the end of the decade. There were Board Members who, back then, said I did not know what I was talking about. Well, we will be just a hop, skip, and a jump away from that after this year.

Don’t expect your representatives in Harrisburg to help. Pennsylvania is suffering a revenue shortfall and not collecting the expected taxes. Moreover, the Central Pennsylvania Business Journal reports that revenue is coming in “below estimates in almost every stream, including personal income tax, the state’s largest source of income.” If the trend continues, the State will have to make cuts to their own spending. Ultimately, it is just more evidence that all taxing agencies cannot just keep reaching into people’s pockets.

Advertisements

7 thoughts on “Octorara Eyeing Up 3.2% Property Tax Increase

  1. Again Mr. Aklexander is fanning the flame of fire in the School District. He never gives as solution to the taxing problems facing the School District. He always is looking for ways to criticize everything about Octorara. Mr. Oleyniczak is a very upstanding and responsible citizen of the School district and if he missed meetings, I am sure they were all valid reasons otherwise he would have been in attendance. Mr Alexander seems to be a negative factor on the Board and maybe should think about resigning his position since he has not solved one issue facing the Octorara School District since being elected to the School Board. Instead of looking for ways to critize the current Board, Adminustration and Tesachers, bring really viabe solutions of change to the table for approval. One must question his underlying motives for being an Elected School Board member.

    • Mr. Butch,

      Now, you know the idea that I don’t talk about solutions is untrue. Shame on you. Even the last time you were commenting on this site, you ended up agreeing with me about misappropriation of resources and overbuilding the campus. Why don’t we talk about the “real solutions” presented by the other Board Members… whining about the State not spending more, complaining Special Education costing too much, and bellyaching about the municipalities not approving new residential development. Moreover, the only solutions ever really offered by the Board is taxing people out of their homes. Is that problem solving?

    • But the other board members are trying to convince us that the district is all unicorns, cherry blossoms and magic fairy dust. You can’t fix a problem if you don’t acknowledge that there is one. Or own your responsibility in helping to create it ..which seems to be their mantra. There is a middle ground I’m sure..but even a blind man can see that this district is rapidly moving in the direction of being completely unaffordable for the average tax payer.

  2. Thank you for the update Tim. You called this for so many years and it is finally coming full circle. Even after watching you spend most of your time trying to convince the board “not” to spend, spend, spend as they keep doing on things we don’t need they still don’t seem to care. Now we are faced with higher taxes and poor education. I think we should fire Dr. Newcome immediately and bring forth a lawsuit against the board members who have done this to us.

  3. Numbers don’t lie. But sometimes people do.  And often people are inclined to shade the truth, to try to ‘spin’ facts.  Sometimes the spin is to try to influence public opinion.  Sometimes the spin is to try to hide just exactly what the facts are.  Sometimes the spin is to try to cover up, or make excuses for, mistakes and poor performance.   Let’s take a quick look at some cold numbers, some hard facts, devoid of spin:

    If one takes the proposed 2017-18 budget of $53,605,175, and divides by the 2,866 students currently enrolled in the OASD, simple math shows that the cost per student will be just shy of $19,000.  No big surprise there: the OASD cost-per-student has been hovering around that number for at least the past four or five years.  Keep that per-student-cost number in mind — $19,000 per year on average for each and every student in the OASD, from kindergartners to high school seniors — as we now look at how that number compares broadly, how that number looks in a relative sense:

    – In 2014 (the latest year for which numbers are available), the average cost per student across the entire U.S. was $11,621.  Do the simple subtraction math and realize that OASD’s annual cost per student is roughly $7,500 HIGHER than the national average, or roughly 64% HIGHER than the national average cost per student.  Hmm.

    – In the same year, 2014, the top six states in terms of cost per student were New York ($20,610), District of Columbia ($18,485), Alaska ($18,416), New Jersey ($17,907), Connecticut ($17,745), and Vermont ($16,988).  THEREFORE NOTE THAT OASD’S COST PER STUDENT IS HIGHER THAN THE AVERAGE COST PER STUDENT IN 49 OF 50 STATES, SAVING ONLY NEW YORK, WHICH IS ONLY SLIGHTLY HIGHER.  Hmm.

    – Closer to home, and again in the same year of 2014, the average cost per student across the Commonwealth of Pennsylvania was $13,961.  Thus OASD’s cost per student is roughly $5,000 HIGHER than the statewide average, or in percentage terms 35% HIGHER the statewide average cost per student  Hmm. 

    Hmm, indeed.  Let’s recap:  OASD’s cost per student is roughly 64% HIGHER than the national average.  OASD’s cost per student is higher than the average in all but one of the states, barely missing out to New York.  OASD’s cost per student is roughly 35% HIGHER than the average across the entire state of Pennsylvania.  Hmm.

    Hmm.  I’m no Sherlock Holmes, but it doesn’t take a whole lot of deductive reasoning to figure out that there is something seriously wrong with this picture, to conclude that OASD is among the costliest school districts in the entire country, at least relative to national and statewide averages.  To be sure, I have no doubt that the school districts representing Greenwich, Connecticut and Malibu, California, and other ultra-wealthy enclaves spend more per student than does the OASD.  But those places can afford it; we can’t.  And besides, most of life and achievement is measured against averages, not exceptions or outliers.  And by the averages — cost per student, student achievement on standardized tests, school taxes, etc. — the OASD excels in costs and taxes, but performs poorly in product, i.e., student achievement.

    Isn’t the internet a wonderful, magical thing?  And more particularly, how great are search engines like Google and Bing?  With just a few keystrokes one can access almost anything, from the tiniest of factoids to the broadest of knowledge and opinion in literally every field.  Amazing.  For example, in gathering the numbers needed to post this comment, the official OASD website was of no use whatever, not even to determine what the actual student enrollment number is.  No problem, no sweat.  A couple of quick search-engine queries provided me with the simple, basic facts I wanted to know…some of the simple, basic facts which I’m afraid some members of the board of directors really do not want local citizens and taxpayers to be aware of.  Because the more cognizant local citizens and taxpayers are of just how screwed-up the OASD is, relatively speaking, the more they might ask inconvenient questions, and the more certain members of the board and their defenders will have to go to ‘spin’ mode, to try to explain away, or make excuses for, the simple, undeniable, and sorry facts:  taxes are too high, student performance is too low, there is a serious disconnect between cost and benefit.  It really is just that simple.

    C. Vail

    P.S.  And speaking of cold numbers and hard facts, who is this Hank Olejniczak guy, this Mr. Invisible, who misses damn near as many meetings as he attends?  Earth to Hank: if you are unable, or just can’t be bothered to attend board meetings, well then please have the decency to resign and just go away.  Earth to Board: if Hank doesn’t have the decency to do the right thing and resign, would it be too much to expect that the rest of you would do the right thing and, one way or another, kick his sorry ass off the Board.  Earth to the people in Hank’s district: apparently he is soon up for reelection, so do yourselves and all of us a big favor and send this no-show, disengaged loser packing.  God knows the OASD board already has problems aplenty; having somebody officially there, but not really there, is just too weird for words.  So Hank, please, one way or the other remove yourself from the play in which you are not appearing, not even pretending to act and be a part of the cast.  Really, please, if you signed-up for the show, but now refuse to appear in the show, then honor and personal integrity demands that you remove yourself from the cast of characters.  Hmm?  Am I right?  Isn’t that what honor and integrity demand?  Do the right thing, Hank.  Get lost.

    P.P.S. With tongue-in-cheek apologies to Jeff Butch and other emotional apologists for the OASD and its board of directors, I say: please, spare me. Frankly my dears, I don’t give a damn about your personal opinion of a certain board member. I could not care less about your long-ago memories of matriculating at Octorara High. And I especially disdain memories of how this or that teacher was really cool, and sort of changed your life. What I know is that damned few if any current OASD teachers have posted comment on this blog, or in any other way spoken out in public to voice personally held views. No surprise there. OASD teachers, like almost all public school teachers, are slaves to their union(s). They are the nearest human equivalent to robots, automatons, blindly saluting their leaders and marching wherever directed.

    And the unbelievably sad, profoundly tragic thing is that it is precisely these brain-numbed, union-above-all-else automatons who are, more’s the pity, in charge in all the classrooms all across the country. Once, just once, I would like to hear of a public school teacher who renounces membership in the teachers’ union(s) because he/she believes that the union wields too much power, and restricts his/her ability to become the best teacher he/she can be. But no, when one is a member of the teachers’ union(s), one has absolutely, positively, pretty much given up all rights of independent thought. And it is these primarily self-interested automatons, these crazy characters, to whom the rest of us have pretty much given over power to raise and educate our children. Pardon me, but I for one would not want any automaton member of a group or union so restrictive and regimented as the American Federation of Teachers and other teachers’ unions coming within a country mile of the education of my own child. The classroom should not be a place for automatons.

    • Thank you for once again providing your valuable perspective. I do have to make one small correction to your numbers. Our student population has dropped to a historic low of 2,404. This will increase next year’s raw per-student cost to more than $22,298. Of course, that number is contingent on Octorara’s student population not continuing to drop, as it has been doing for years.

  4. From a recent column by Charles Krauthammer:

    “Now, teachers are wonderful. But teachers unions are there to protect benefits and privileges, not necessarily to improve schooling. Which is why they zealously defend tenure, protect their public-school monopoly and reflexively oppose school choice.”

    You can read the entire article here:

    https://www.washingtonpost.com/opinions/the-trump-cabinet-bonfire-of-the-agencies/2016/12/15/3e9d7680-c309-11e6-9a51-cd56ea1c2bb7_story.html?utm_term=.cec8d3bf2f34

    Or if the link doesn’t work, just Google ‘Bonfire of the agencies’

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s