A new report from Pennsylvania's Independent Fiscal Office (IFO) predicts a significant increase in school district property taxes over the next two years. The IFO forecasts a nearly 5% rise in 2025, followed by a 4% increase in 2026. This is a substantial jump compared to the 2.4% to 3.3% growth observed in recent years.
School district property taxes, a major source of revenue for schools, are expected to total $16.6 billion in the fiscal year 2022-23, rising by 3.2% to almost $17.2 billion in 2023-24. The IFO projects that by 2024-25, statewide school district property taxes will reach $18 billion and $18.7 billion in 2025-26.
The increase in 2022-23 was the largest since 2018-2019, largely driven by a citywide property reassessment in Philadelphia, which resulted in a 31% rise in the assessed value of single-family homes.
Despite the increase in property tax collections, their overall share of funding schools has dropped in recent years. Instead, temporary federal aid from COVID-19 and state sources have grown.
The report also notes that schools are growing their unassigned money in their general fund balances. Unassigned funds grew by 61% from 2018-19 to 2022-23, jumping from $1.9 billion to $3.1 billion.(tnonline.com)
