MILL HALL — Due to a higher-than-expended cost for cyber-charter tuition, the Keystone Central School District’s 2024-2025 budget took a hit.

The district’s board of directors received an end-of-year report about the budget during its work session last Thursday by Business Manager Joni MacIntyre.

According to the numbers presented, the district saw a shortfall of $2,782,985.

MacIntyre offered a breakdown of the budget’s revenues and expenses for the fiscal year to explain how the shortfall came about.

In its revenues, MacIntyre said the district was able to see an increase of about $1.6 million.

This was due to an increase of about $319,000 in local revenue; a $1.1 million increase in state funding and $184,000 increase in federal funding.

She noted, however, the district did see a decrease in its Business Privilege Tax funding, a decrease in Investment Interest due to rates dropping and lower IDEA Revenue on the local revenue.

In state revenue, MacIntyre said the district’s transportation subsidy saw a decrease of about $245,000. She expected this subsidy to continue to decrease.

“I think we’re going to see this as a downward trend because the price of fuel is going up. The formula hasn’t changed to regulate the impact the increase of fuel taxes is having on it,” she said.

Expenses are where the district saw the most increases, particularly regarding cyber charter tuition.

According to the presentation, the district saw an increase of about $2.8 million for cyber tuition and $845,000 in chart tuition.

“That is money that we did not predict. The cyber charter tuition rates are just increasing,” she said.

Though the recently passed state budget included a bit of relief for the district regarding the cost on districts for cyber charter expenses, MacIntyre said it isn’t enough.

She said from 2023-2024, two years later, to 2024-2025, the district saw an increase of about 8.5 percent for regular education and 12 percent for special education costs for cyber charter tuition.

If you remove the increased cyber charter expenses, MacIntyre said the district was about $800,000 over its budget.

“That was a .9 percent difference in what we budgeted versus the actual,” she said.

Of those funds that the district has more control over, MacIntyre said a big hit came from maintenance — particularly electric.

“Electric rates increased by about $90,000,” he said.

She noted she and Property Services Director Sam Hoy were able to secure a new electric and gas rates contract which should help see savings in the coming year.

“I don’t think it’s going to be substantial but I hope it’s going to be near that $90,000,” she said.

The final portion of MacIntyre’s presentation focused on the predicted general fund balance.

“One of the most important numbers on here is the unassigned fund balance. A healthy fund balance with the unassigned is somewhere between 7 and 8 percent,” she said.

According to figures MacIntyre presented, the district’s 2024-2025 actuals reflected an unassigned balance at 3.5 percent, a drop from 8.7 percent during the 2023-2024 year.

“What I want to point out, too, is if you add the $3.6 million that we did not predict for cyber charter… we’re at 7.5 percent,” she said. “So, again, our decrease is the majority from cyber charter increases.”

As the administration looks at its 2025-2026 budget, MacIntyre said her office is looking very hard at the district’s spending.

“We are definitely looking at our expenses and what we’re spending now,” she said, noting the district is actually down in terms of its spending so far this year.

She further noted the district has not yet paid its cyber charter school bills yet.

“We did not pay that because we did not receive the money from PDE. So we did not give that to the cyber charter,” she said. “So you are going to see that money be released.”

Following the presentation, Board Member Chris Scaff requested the numbers for 2023-2024 be included in the upcoming presentations to the board, to give its new members more background on the district’s trends.

MacIntyre said she would include these numbers moving forward.