School Districts Amass Record Reserve Funds

Is your local school board planning to raise property taxes despite holding millions in reserve funds? For many Pennsylvania school districts, the answer may be “yes.”  

Check out CF's sortable, searchable database of fund balances for Pennsylvania’s 500 school districts in the 2014-15 school year. It is important to note these figures predate the 9 month budget impasse, during which Gov. Wolf held school districts hostage in an attempt to extract record-high tax hikes from families and businesses.

Many districts were forced to dip into their reserves last year, as a result of Gov. Wolf's actions. (Next summer's financial reports will reveal how much districts were forced to “spend down”). But the sheer size of reserve funding in certain school districts is staggering—especially given the constant drumbeat that Pennslyvania schools are “underfunded.” 

A district’s fund balance—what it owns minus it what it owes—is comprised of assigned, committed, and unassigned funds. Assigned and committed reserves are available funds designated for a specific purpose, while unassigned funds are available for any purpose.

State law requires that districts seeking tax hikes limit their unassigned fund balances to 8 to 12 percent of total spending. Our sortable database includes the total fund balance for each district, as well as each district’s total expenditures in 2014-15. It also includes each district’s fund balance as a percentage of total expenditures.

Auditor General Eugene DePasquale, speaking to Jan Murphy of Pennlive, says it is excessive to maintain a fund balance greater than 20 percent of total expenditures:

More than 300 of the 747 districts, charter schools and career and technical centers included in the department's data had fund balances topping 20 percent of their total expenditures, which is where state Auditor General Eugene DePasquale said he believes the line should be drawn.

“It is a judgment call as to what is too high,” DePasquale said. “Certainly anything that is above 20 percent, clearly that's where you start to question it.”

In fact, there are 21 districts who have socked away over 50 percent (!) of their total expenditures in reserve. When looking only at unassigned fund balances, 36 districts have over 20 percent of total expenditures squirreled away.

These figures should be eye-opening to anyone who believes Pennsylvania schools are unfunded—and they should be a wakeup call for school board officials who instinctively seek higher taxes from state or local taxpayers.

Check out CF's sortable, searchable database.