Pocono Mountain School District

POCONO MOUNTAIN SCHOOL DISTTRICT:

The Pocono Mountain School District, a school district of the second class, is located in the Pocono Mountains of Monroe County in Northeast Pennsylvania. The District spans 304 square miles and serves students in grades K to 12 from eight (8) municipalities – Barrett Township, Coolbaugh Township, Jackson Township, Mount Pocono Borough, Paradise Township, Pocono Township, Tobyhanna Township, and Tunkhannock Township. 

The District employs 1,358 personnel comprised of 451 support staff, 820 professional staff, 70 administrative employees, and 17 security guards.

The District operates nine (9) brick-and-mortar schools and one (1) cyber program and provides educational services, supports and interventions for approximately 8,885 students. All nine (9) District schools are Title I schools, due to the District’s very high percentage of students who are economically disadvantaged and qualify for free and reduced meals as part of the National School Lunch Program. Schools on the West side of the District have economically disadvantaged student populations of more than 70 percent. The District’s student population is also very diverse with its demographics as follows: 

Enrollment / Diversity

The District educated a diverse population of approximately 8,885 students in grades kindergarten to grade 12 during 2018 – 2019. 

While the District’s student population has decreased over several years from its highest population of more than 11,000 students in 2009, the District’s special education population has continued to increase with 24 percent of District students now requiring special education services and supports.  The needs of the District’s special education population and the cost of providing those needed services and specialized transportation is exploding and creating the need for the District to apply this year for relief from the Pennsylvania Department of Education as follows:

The real estate market and home values have not yet recovered since the subprime financial crisis in 2008, with many homes still falling into foreclosure.  The burden of property taxes is felt very acutely throughout the District. The state has underfunded the District by tens of millions of dollars for more than thirty (30) years. In the absence of adequate state funding, property owners have been forced to supply more than 66 percent of the revenue needed to conduct District operations, while the state only funds approximately 30 percent of the District’s operating expenses.

Meeting Public School Employees’ Retirement System (PSERS) employer retirement contribution payments continues to be a fiscal challenge for the District with no end in sight as the state continues to increase the District’s contribution percentage required to sustain employee PSERS benefits. PSERS increases have a significant impact on the District’s annual budget and financial health as the District has had to utilize its fund balance for six (6) consecutive years to balance its annual budget.

Projected employer retirement contribution rates are shown below:

The Charter School Act of 1997 provided another publicly funded education option for Pennsylvania students. Charter schools are self-managed public schools that are approved by local school districts. Cyber-charter schools are also self-managed public schools, but cyber-charter schools are approved by the Pennsylvania Department of Education ("PDE"). Tuition payments received by charter schools and cyber-charter schools are taxpayer dollars that support students who are residents of the local school district. Tuition payments are based upon the District’s budget, not the actual operating costs of the charter or cyber-charter school. The District had 452 students attending eight (8) charter schools and eleven (11)different cyber-charter schools, at a cost of approximately $8,580,820 in the 2018 – 2019 school year. The District has to increase its cyber and charter school budgetary expenditure appropriations each fiscal year. Projected cyber and charter school costs for the 2019 – 2020 fiscal year is $8,692,500. 

Historical Financial Information

The table below depicts a summary of the District’s financial results over the prior three (3) fiscal years and the most previous completed fiscal year preliminary unaudited results. The 2019 – 2020 Final Budget revenues do not include the appropriation of fund balance utilization. The District has experienced an excess of expenses over revenues for the previous three (3) out of four (4) fiscal years.

The District incorporated the utilization of fund balance as a component of the final general fund budget for each of the prior six (6) years. The table below identifies the amount of fund balance utilized as part of the fiscal year budget.

Financial Projections for the next five (5) fiscal years based upon the specific revenue and expenditure line items from previous District budgets show the District will deplete its undedicated fund balance within the next three (3) years if the District continues to borrow from the fund balance to balance its budget (see chart below).