SLIPPERY ROCK — Slippery Rock Area School District passed a preliminary budget as it eyed a deficit nearing $900,000 at Monday's meeting.

A preliminary budget is not final and includes many uncertain variables.

“It's not uncommon for the preliminary budget to show a deficit,” said the district's business manager Paul Cessar. “We're working with very preliminary estimates.”

Slippery Rock's preliminary 2020-21 school year budget shows projected expenses of $34.75 million, a $1.12 million increase from last year.

The preliminary budget shows a projected revenue of $33.67 million, an increase of $379,179.

An amount set aside from last year of $200,000 is available, bringing the deficit to $876,053.

The majority of the increase comes from employee salaries, retirement and benefits.

Cessar said employment costs could change by next year.

“This budget contains the same staff as we currently have,” he said. “We anticipate several retirements that don't calculate into this budget until we get the paperwork.”

Cessar said the state hasn't set its budget, which makes state allocations to the school a major unknown variable.He said the state likely will pass its budget in February.On the revenue side, Cessar said an increase in assessment could help. Every 1 mill generates about $140,000 in revenue for the district.“It's hard to predict before we get a little further along the line to get a better idea of that number,” he said.By submitting a preliminary budget now, the district keeps available an option of increasing its millage above the index set in 2006.Under Act 1 of 2006, school district real estate tax increases are limited to an index set by the act.If Slippery Rock increases its millage by 3.2924 mills, it would generate roughly an additional $460,000 annually.A district can raise taxes higher than the index if it passes a preliminary budget by Jan. 27 and files for exceptions through the Pennsylvania Department of Education.Voters will have a chance to approve the referendum through a ballot question on the May primary election.According to the district's projections, an increase of 6.26 mills would be necessary to satisfy the deficit and balance the budget. The current millage rate is 99.77.Cessar said it's possible the variables turn favorable for the district, but he and the administrators are planning for any alternative. “We're going to continue working on this and making adjustments over the next six months,” Cessar said.The final budget must be approved by June 30.