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School districts to PA: ‘pay up;’ The taxpayer price tag for unfunded liabilities

April 2, 2014

What would you do if your school district were considering up to a 6% hike in your school taxes? Who would you complain to (besides the school board, of course)? Perhaps you’d take your complaint to a higher level—to state authorities, for example? (For all the good that might do you in Pennsylvania.) Let us explain.

Taxpayers in the Western Wayne School District (WWSD) in South Canaan Twp., Wayne County, PA, are bracing themselves for the possibility of a major tax hike, and the school district is putting most of the blame on the Commonwealth of Pennsylvania itself for not paying reimbursement money it owes WWSD for the construction of a new elementary school that opened in 2011. (Reportedly about 150 other public school building projects in Pennsylvania are in the same boat as Western Wayne.)

The $20-million EverGreen School in Hamlin is one of the greenest schools in the state. It is silver LEED-certified with geothermal heating and cooling, a “living machine” wetlands sewage treatment system, a system of louvered window shades that capture sunlight for lighting classrooms (plus LED light bulbs and motion sensors to turn off the lights), and more. Green construction materials and practices were used when it was being built.

From the 1970s to 2012, when a school district in Pennsylvania initiated a major construction project, it engaged with the PA Department of Education (PDE) in a process called PlanCon (short for Planning and Construction Workbook). If the district followed all the proper steps, it could receive some level of reimbursement to help cover the cost of construction.

However, since 2012, there has been a moratorium imposed by the legislature barring PDE from accepting any new PlanCon applications and the state has stopped paying what it owes on approved and/or fully completed projects. PDE says it would need millions of dollars it does not have to reimburse already approved and/or completed projects, plus $1.2 billion to cover the 354 currently unapproved projects now in the PlanCon pipeline (see tinyurl.com/jwhl45q; also see tinyurl.com/n2sq57y).

Over nearly the past year and a half, as overdue payments have piled up, school districts nevertheless have had to make bond payments without funds they had been promised. For WWSD this means the “state will owe [the district] $1,250,800 by the end of this school year, with the addition of another $687,821 in the 2014-2015 school year,” according to a letter to taxpayers posted on the WWSD website (tinyurl.com/l5eudva).