It might not take their breath away, but residents of 10 local school districts are all but guaranteed not to see double-digit tax increases next year.

That's because 10 of the 16 public school districts in Lancaster County have promised not to try to raise property taxes by more than their state-assigned limits for the 2008-09 school year. Limits across the county range from 4.4 percent to 6.3 percent.

The six districts leaving open the possibility of higher tax increases are Columbia, Eastern Lancaster County, Ephrata, Hempfield, Lancaster and Solanco.

The caps, or "index" as the state calls each district's maximum tax increase, are part of the taxpayer-relief law known as Act 1.

The state law, now in its second year, aims to control property taxes by limiting how much each school district can raise taxes without voter approval.

The 10 school districts that have pledged to keep tax increases at or below their state caps avoid a difficult step required by the law: posting a preliminary budget for public review by Jan. 3 — which is at least five months before school districts have any concrete financial numbers.

While it's not the only reason, it contributed to the Conestoga Valley School Board's decision.

"The process is very cumbersome," school board President Idette Groff said. Putting together an accurate budget this early is "absolutely impossible."

And, Conestoga Valley's administration felt confident it could balance the 2008-09 budget within the limit assigned by the state, Groff said.

Clarence Kegel Jr., attorney with Kegel Almy & Grimm, which represents several local districts, said the law "requires many somewhat meaningless steps and hurdles that take significant time, impose extra expense and confuse taxpayers."

Another reason most of the school districts are able to vow early not to go above their tax limits (called indexes) is that their 2008-09 limits are higher, Kegel said. The average county index is 5.2 percent, 1.2 percentage points above the 2007-08 school year.

How it works

Under Act 1, if a district wants to raise property taxes (millage rates) above its annual state-imposed limit, it can ask the state's permission.

The state then weighs whether the district meets Act 1's criteria for raising taxes.

The district's request must prove that its state-set cap is too low to meet out-of-its-control expenses — such as retirement contributions, construction and health care.

For 2008-09, school districts have until late January to file for such permission. They find out if they've been approved by Feb. 27.

On Dec. 4, the state released information to the school districts on what data from past school years they can use to calculate their expenses for 2008-09.

However, the state has not yet released the guidelines districts will have to abide by in filing their requests.

"They have been very specific in the past that we must use their calculation spreadsheets, not something we put together on our own," Hempfield finance director Rich Schrecengost said. "So we must estimate our preliminary need for this proposed preliminary budget process."

Any school board that might want to raise taxes above its district's state-set limit must post a preliminary budget by Jan. 3.

The districts have to estimate expenses based on numbers gathered less than four months after classes began for the 2007-08 school year to complete their preliminary budgets for the next one.

The state has three options when it receives a request: it can deny it, approve the district's request, or set a new limit that's higher than the old cap.

Last year, 15 of the 16 local school districts asked for new caps and got them. Seven used the state's permission to raise taxes higher than would have been permitted under the state's original cap.

If the state refuses a higher cap, the school district can appeal to voters. Many local school officials believe voters are unlikely to approve a property-tax increase at the polls.

Why this time around?

For the 2007-08 school year, Donegal started with a cap of 4.3 percent, got permission to raise taxes as high as 12.4 percent to cover debt but approved a 9.5 percent increase.

Donegal is one of the 10 districts this year to pass an early resolution promising not to raise taxes above its 2008-09 limit of 5.6 percent.

District officials believed they would not qualify for a higher tax cap.

The district plans to use its surplus to balance next year's budget.

On the other side, is the School District of Lancaster. It is among six county districts going through Act 1's early budget process.

Its school board already has approved a preliminary 2008-09 budget that calls for a 6.3 percent tax increase, the same as the district's index.

Still, the district will go through the early budgeting process, just in case.

President Patrick Snyder said that even if the state permits a higher tax cap, it doesn't mean the district will use it. Last year, it got permission to raise taxes 7.8 percent, nearly double the state's original 4.8 percent cap, but then held its tax increase to 4.8 percent.

And, the district "will refine the budget as we start getting indications as to what we will be getting from the state and the federal government."

What districts did

for 2007-08

In order to file for higher tax caps, a school district had to present a preliminary budget to its public by Jan. 25 and pass its early budget in February.

For the 2007-08 school year, 15 school districts filed for higher caps and got them; seven used them to raise taxes higher than their original caps, but only five raised taxes as high as the state said they could.

Ephrata was the only school district not to file under Act 1 last year.

Three school districts passed increases lower than their original caps.

Manheim Central started with a cap of 4.1 percent; the state approved a 5.6 percent increase, but the district didn't raise taxes at all.

The Conestoga Valley, Lancaster, Manheim Township and Pequea Valley school districts raised taxes at their original limits, 3.4 percent, 4.8 percent, 3.4 percent and 3.4 percent, respectively.

The districts with the highest percent tax increases countywide were Columbia (10 percent), Donegal (9.5 percent), Elizabethtown (6.89 percent), Cocalico (5.47 percent) and Hempfield (5.23 percent).

Elizabethtown's 6.89 percent was 0.09 of a percentage point more than its state-adjusted rate of 6.8 percent, due to rounding errors, business manager George Longridge said.

As for the high tax increase, "last year, we had a pretty big hit in health insurance. It doesn't look it's going to be that bad this year," he said.

• CONTACT US: rmeadows@LNPnews.com or 481-6025