BUTLER TWP — The Butler School District will not increase property taxes more than 3.03 mills for the 2016-2017 school year.

The school board unanimously approved that decision Monday night by agreeing not to increase taxes beyond the state-mandated maximum.

Board President Nina Teff said any discussion about a specific tax increase would come in May and June later during the budget process.

For the district, the state’s maximum index to raise taxes is 3.2 percent of the current 94.8 tax rate, according to Deborah Brandstetter, director of business services.

“I don’t have any reservations with this (resolution),” Teff said after the meeting. However, she said the lack of a state budget for 2015-16 has left the district’s financial situation “in jeopardy” because it is not getting state funds.

Board member Bill Halle previously expressed concern about the future of the district’s finances if expenses, including pension payments mandated by the state, increase over the next few years.

“I’m not advising that we raise taxes above that highest amount,” Halle said. “I just think we need to start looking at how we raise taxes and the ability to start attributing part of the tax raise to bringing down the debt.”

However, board member Suzie Bradrick said raising the taxes by significant amounts could have a bigger impact on taxpayers as compared to more moderate annual increases.

“That’s a big increase for some individuals,” Bradrick said, regarding a 3.03-mill tax increase.

Mark Krenitsky of Meridian told the board there is no reason to raise taxes that significantly.

“We don’t want to go anywhere near that 3.2 percent increase,” he said. “Costs do matter. They really do.”

The district must pass next year’s budget by July 1, 2016.

The board also approved taking out a $16 million tax anticipation note as a stopgap measure to ensure the district has enough money if the state budget impasse continues past February.

With a lack of state funds, the district could use that money, if needed, to pay bills next year.

The note would be with First National Bank.