EASTON, Pa. — Easton Area School Board on Tuesday took a preliminary look at the district's 2027 school year budget, and is facing a $7 million funding gap and a 3.5% tax increase.
District Chief Financial Officer Jack Trent cautioned board members that it's not quite a top concern, at least not yet, but there are issues with capital projects and growing operational costs.
“So as you can see, there's a little under $7 million gap. That is where we start with budgets. Usually, it's not something to sound the alarm about just yet."EASD Chief Financial Officer Jack Trent
Trent offered an early peek at the district’s 2027 budget, particularly in the area of rebuilding capital reserves and protecting and growing the fund balance.
Trent and the district are exploring options to rein in costs and rebuild reserves that have been tapped time and again to fix previous shortfalls.
Also Tuesday, the board held a reorganization meeting that saw Meg Sayago and Edward Keegan sworn in.
The big priorities
According to Trent, the $298 million earmarked for the construction of the new high school is a sizable priority, “and we need to build capital reserve and fund balance for these initiatives.”
And while that big-ticket item is certainly a concern, Trent emphasized that growing the district’s reserve fund is pivotal to ensuring stability.
“The district has been utilizing its reserve funds to cover budget gaps for multiple years now,” Trent said. “It's been identified as a non-sustainable practice for us."
He said Superintendent Tracy Piazza "has maintained we'll have balanced budgets, which we will, and we also need to find a way to generate surplus, as well, to begin to rebuild our funds, our reserves, for future fiscal health.”
Additional priorities will include managing growing operational costs — largely via evaluating and managing large expenditures like salaries and benefits.
Also, maintaining and supporting student achievement programs to promote a supportive learning environment, and balancing staffing sizes to manage personnel costs.
Budget breakdown
As it now stands, EASD is looking at $224,749,645 in projected revenue from local, state, and federal sources. Expenditures are currently estimated at $231,697,165.
“So as you can see, there's a little under $7 million gap," Trent said. "That is where we start with budgets. Usually, it's not something to sound the alarm about just yet.”
Trent said the projections are based on the assumption of a 3.5% tax increase in accordance with the capital projects plan, flat state and federal funding, and that the listed expenditures were calculated at the maximum estimated rate.
“Salaries and benefits consume most of the budget," he said. "Right now, I'm looking at 65% of the budget. It was 64%, and it's important to realize that even with everything we've done so far with staffing increases, it's going to continue to go up.”
Salaries alone take up 39% of the budget, while benefits sit at 26%, purchased services (third party vendors that take care of anything not handled in-district) consumes 20% and supplies, property costs and bonds take up 15%.
Cost-saving strategies
There are cost-saving strategies the district can employ to achieve a balanced budget, Trent said.
“We're maybe looking at how we can invest in preventative maintenance or saving money on utilities, which we are currently doing in the business office,” Trent said of operational and facility expenses.
“That's what I'm referring to with the fund balance, is how are we going to increase our fund balance, increase our cap reserve, just have everything we need to properly run the district, because that's one of the goals with this budget.”Easton Area Schools Chief Financial Officer Jack Trent
“We can look at optimizing transportation, whether it's buses that are more efficient to run, whether it's optimizing routes, whether it's optimizing maintenance procedures.”
Controlling personnel and administrative cost also will be explored, Trent said, with the potential to reduce or eliminate overtime across the district, and more negotiations on health care.
Further work on procurement and purchasing needs to be addressed, as well, Trent said, and with a new purchasing agent position in the district, “we’re already seeing gains.”
Trent said he will spend the near future working on a multiyear plan for the district, which shed some light on best practices to rebuild reserves.
“I'll be presenting in the next couple months to the board a multiyear plan, three- to five-year, most likely five-year plan, of where we're at with budgets proceeding forward, and the fiscal stability part is the big part,” Trent said.
“That's what I'm referring to with the fund balance, is how are we going to increase our fund balance, increase our cap reserve, just have everything we need to properly run the district, because that's one of the goals with this budget.”
Next steps
Up to January, Trent will review the budget with school principals and directors. In February and March, the executive team will finalize the fiscal year 2027 budget, he said.
A budget update is scheduled for the March 24 board meeting.
Through March and April, Trent intends to meet individually with board members.
A proposed final budget presentation is set for the April 28 board meeting, with a final vote for the May 19 meeting.
"My commitment is that we are going to have a balanced, or better than balanced, budget while I'm here. And that is not going to change, and that takes tough decision making and some sacrifices along the way."Easton Area Schools Superintendent Tracy Piazza
Piazza advised the board that the district is waiting on audits for the 2023-24 and 2024-25 budgets, “and once that information is clearly articulated, then we know what our steps moving forward are.”
"My commitment is that we are going to have a balanced, or better than balanced, budget while I'm here," Piazza said.
"And that is not going to change, and that takes tough decision making and some sacrifices along the way.
“But what we want to preserve to the greatest extent is our educational programs and our staff that needs to be here to deliver those programs.
"And so we will continue to look at attrition as appropriate and other mechanisms for really looking at the cost savings, including the duplicative services and programs that we may have.
"But we are here for one reason — that's to educate our kids.”
