The Shaler Area School Board has approved a bond issue that will restructure the district’s debt and pay for building projects, dominated by work at the middle school for which contracts were already awarded.
The bond issue the board approved on a 7-0 vote April 22 is for up to $50,325,000. Board members James Tunstall and Dorothy Petrancosta were absent.
The actual amount is expected to be between $40 million and $41 million, said Ronald Brown, the district’s bond counsel with the law firm Dickie McCamey. The difference allows the district’s representatives flexibility when they go into the market.
From that, the district will get $7.5 million in new money for capital projects, with the remaining $32.5 million to $33.5 million refinancing part or all of bond issues from 2016, 2019, 2020 and 2021, Brown said.
Most of the new money will be spent at the middle school. On March 18, the board awarded four contracts totaling about $4.6 million to replace the school’s entire roof.
Additional work at the middle school, plus projects at Reserve Primary and Shaler Area High School and safety zones on three roads, are expected to cost $8.1 million. After a $1.3 million state grant used at the middle school, the total projected cost is $6.8 million.
The debt restructuring gives the district two years of budget relief, eliminating a deficit for the 2026-27 school year and reducing the projected deficit in the 2027-28 school year before a deficit returns in 2028-29, according to business Manager Kim Pawlishak.
With the bond issue, the $99.1 million 2026-27 preliminary budget shows a nearly $608,000 surplus, with no property tax increase. Without the debt restructuring but with borrowing the new money, the deficit would have been just over $4 million, again with no property tax increase.
Savings from the bond issue continue for the 2027-28 school year, where a deficit is projected but reduced from about $6.4 million to $2.5 million, also with no property tax increase.
By the 2028-29 school year, with or without the debt restructuring, the deficit is projected to exceed $8 million.
If the district were to increase its property tax rate by its full limit allowed by the state, and combined with savings from the debt restructuring, Pawlishak estimated it would have a $2.9 million surplus in 2026-27 and $2.1 million in 2027-28, with the deficit in 2028-29 reduced from about $8.5 million to $1.6 million.
For the current school year, the district’s revenues have been about $1.4 million, or 1.44%, higher than budgeted while expenses have been slightly lower, by about $259,000, or 0.25%, Pawlishak said. As a result, the $2.6 million deficit expected for the year has been reduced to about $856,000, which the district will cover from its fund balance.
The board did not increase the property tax rate for the current school year, despite a recommendation to do so. That decision resulted in work at the middle school being scaled back, including removing plans to add air conditioning to the entire building.
The board is expected to vote on the proposed final budget on May 13. A final budget presentation is scheduled for June 10, followed by a vote to adopt the final budget on June 17.