Manheim Township school board Thursday agreed to limit any tax increase in next year's budget to 1.7 percent and approved a five-year contract with superintendent Gene Freeman.

The employment agreement, which runs through June 2018, will pay Freeman in excess of $1 million in salary and compensation over five years, making him the highest-paid superintendent in Lancaster County.

The vote on Freeman's contract was unanimous, as was the vote to keep a possible tax rate increase for 2013-14 at or below the school district's Act 1 index of 1.7 percent.

That vote marks a return to form for the district, which had stayed within its state-mandated index every year since 2006 until 2011-12, when it boosted taxes by 3.96 percent in the face of a revenue shortfall of about $4.7 million.

Thanks to a pay freeze by teachers, a spate of retirements and reductions in operating costs, the district faces a much smaller revenue gap for 2013-14 of about $3 million.

If the board were to raise taxes by 1.7 percent, it would cost the average homeowner an additional $46 next year.

The school district has yet to begin public budget deliberations and has until May to adopt a proposed 2013-14 spending plan. A final budget must be approved by June 30.

Freeman's contract, which takes effect July 1, 2013, will boost his base salary from $166,240 to $179,000 next year, a 7.8 percent increase.

He also will receive an $18,440 payment into a retirement account, a benefit he receives in his current contract, for a total compensation of $197,440 in 2013-14.

That will make him the highest-paid superintendent in the county, eclipsing Hempfield School District's Brenda Becker, who is slated to earn $186,900 next year.

His base salary will increase by 1.75 percent in each of the second and third years of the contract and by 3.75 percent in each of the final two years.

For the past two years, Freeman has taken a voluntary pay freeze.

Over the life of the agreement, the district's contribution to Freeman's retirement fund will decline by $2,000 each year. By year five, his base salary and retirement contributions will reach $211,918.

In each year of the contract, the school board may award Freeman an additional merit increase of 2 percent to 5 percent of his base salary, to be paid into his retirement fund.

The contract also provides:

nThirty paid vacation days and 12 paid sick days per year.

nA $7,800 first-year vehicle allowance, rising to $8,400 in years two through five.

nA $1,400 first-year reimbursement for health care costs not covered by the district's health care plan, rising to $1,600 in years two through five.

nA potential $10,000 bump in base salary if he retires from the district, plus a $15,000 retirement fund payment and a retirement bonus of up to 15 percent of his final base salary.

Following approval of the contract, school board president Hannah Bartges praised Freeman for leading the district through recent difficult economic times and for keeping the focus on what's important to children.

"I am so glad to be here," Freeman said. "Thank you all."

Manheim Township is the fourth county district in recent months to approve a new or extended five-year contract for its top administrator.

Warwick extended the contract for April Hershey in October, School District of Lancaster gave Pedro Rivera a new contract in September, and Eastern Lancaster County School District gave Robert Hollister a new pact in July.

Their base salaries next year will range from $145,000 for Hershey to $176,000 for Rivera.
bwallace@lnpnews.com