Coronavirus’ Impact on School District Tax Revenue

School districts have been closed since March due to the coronavirus and were permitted to reopen on July 1 after approval of a health and safety plan.

According to 2018-19 data from the Pennsylvania Department of Education, Allegheny County school districts raised $1.6 billion in local revenue. Property and wage taxes accounted for $1.4 billion (89 percent) of the total.

By comparing 2019-20 and 2020-21 budgets, it is possible to see what districts expect the virus’ budgetary impact to be in the future. The sample covers 26 school districts. Property tax rates will stay the same in 14 districts but will increase in 12. Only one district is budgeting for an increase in wage tax revenue. Meantime, 23 districts expect wage tax revenue to fall. The range of losses goes from 3 percent to 19.1 percent.

School districts will receive federal revenue from the CARES Act. $9.6 million will go to the sample districts, ranging from $60,379 to $1.6 million.

17 districts show an increase in year-over-year spending, while nine show a decrease. Twenty-one districts show expenditures exceeding revenues in 2020-21.

With taxpayers looking for school tax relief, districts should look at how to become more efficient to reduce costs.

Read the full policy brief here.