Although it was an unusual year with many unforeseen expenses, residents of the South Butler County School District will not see a tax increase next year.

The school board approved the preliminary 2021-22 budget Wednesday in the amount of $36.9 million.

The budget is available for viewing on the district's website, southbutler.org, for 30 days. The board is expected to vote on a final version of the budget at its June 16 meeting.

Pam Mondock, district business manager, said expenses exceed revenues by a little more than $23,000, but that amount will be covered by the undesignated fund balance.

The main expenses in the budget are salary increases and district contributions to the teachers' state pension fund.

One significant expense that has occurred because of the coronavirus pandemic is the amount the district has had to pay cyber/charter schools many parents enrolled their students in during the coronavirus pandemic.

Mondock said in the 2019-2020 school year, the district spent $815,000 on cyber/charter schools.

This year, the district has paid $1.3 million so far, she said.

The preliminary budget includes a $1 million line item for cyber/charter school expenses next year.

“We hope students come back to our brick and mortar schools because we believe the best instruction is with the teacher in a classroom,” Mondock said.

She said with the proliferation of the vaccines and cases falling, administrators are anticipating that students will return to school.

A surprising facet of the budget preparation process, Mondock said, is the increase in earned income taxes during a pandemic year.

Administrators worried earlier in the current school year that EIT revenue would decrease due to job loss associated with the pandemic.

But Mondock said while the district collected about $1.9 million in EIT tax through April 2020, more than $1.92 million has been collected so far this year.

“That has been a bright spot,” she said.

Regarding revenue from real estate taxes, Mondock said the district collected $300,000 more this year than was budgeted in 2020.

“We budgeted conservatively last year (on real estate tax revenue) because we were fearful of the potential effects of the pandemic,” Mondock said.

About $600,000 in Elementary and Secondary School Emergency Relief (ESSER) funds are being earmarked for the 2021-2022 general fund, she said.

In addition, the district will begin receiving $50,000 monthly ESSER payments beginning in July.

The monthly allotments could last until Sept. 2024, and can be adjusted if the district has additional expenses related to the pandemic, Mondock said.

Donna Eakin, school board president, said she was pleased the budget could be balanced without a tax increase.

“Charter school tuition has certainly caused us a bit of consternation this past year, with payments going from $815,000 to $1.3 million,” Eakin said. “Because of our efforts the past few years saving for a renovation project, we are financially healthy at the moment.”

The preliminary budget passed by a vote of 7-1, with board member George Zacherl dissenting.

Zacherl said he voted against the preliminary budget because it was not discussed during the board's two monthly public meetings.

Rather, it was hammered out and then presented in the finance committee, which is not generally attended by the public.

“All in all, there was no discussion about it during the meetings,” Zacherl said.

He cited the upcoming expiration of the teachers' contract, renovations that have been put off for several years and potential mental health needs of the students from the pandemic as future needs in the district.

He also said the board has no future strategy regarding taxes in the district, so the board considers the budget on a year-to-year basis.

“There is not forward thinking or planning for future needs,” Zacherl said. “The overwhelming philosophy from several of the board members is to keep taxes as low as possible and not be thinking about the future needs of our district.”

He said he does not necessarily think a tax increase was in order, especially during a pandemic year.

“But we should at least talk about it,” Zacherl said.