BUTLER TWP — Taxpayers in the Butler School District will pay more to run the district next school year.

The school board has approved a 4 percent property tax increase in the $94.9 preliminary million budget for the 2010-11 school year.

That has a 3.3 mill tax increase, which would raise the tax rate to 88.43 mills.

The proposed 3.3-mill tax increase would increase the average homeowner's tax bill by $57 to $1,537 a year. A mill is $1 of tax for each $1,000 of assessed value.

The board said Monday night it is raising taxes because of less income, which included $850,000 less because of low interest rates in the past two years, $100,000 less from the state's Safe Schools program last year, and $500,000 less in federal funding in the past five years.

Because of these reductions, the district chopped the Transitions High School from its programming. That had offered students with drug and alcohol problems an alternative education.

Also eliminated are five full-time teaching positions and a part-time teaching position.

The board also cited the increased costs for retirement contributions as a problem. Board member John Conrad said this budget includes $1.6 million more for pensions than the current budget does.

The budget takes $4.9 million from the district's fund balance, leaving $4.6 million. That is 5 percent of the budget, which is at the lower end of the state guidelines for a fund balance.

State law prevents the district from having a fund balance of more than 8 percent of its budget when it raises taxes.

The preliminary budget passed by a 7-2 vote, and a vote on the final budget is expected in June.