Catasauqua Area School District Board of Education heard a budget presentation March 19 for the 2025-26 budget, presented by Lindsey Wallace, district business manager.

According to the presentation, driving factors for the budget include contractually required salary and benefit increases, a new position, high inflation costs, capital projects, increased special education needs, charter school tuition costs and mental health services. Additionally, the ESSER funding has been completely phased out.

The overall 2025-26 budget has revenues and expenditures balanced at $44,580,182. The proposed millages for 2025-26 are 23.0409 for Lehigh County and 59.9535 for Northampton County, at a 5.1% Act I adjusted index. This is a millage increase for Lehigh residents and a decrease for Northampton.

The capital improvement plan phase one includes the Catasauqua High School roof, weight room, gym bleachers and exterior repairs, the concession stand roof, bank erosion at Thomas Field and starting the CHS HVAC project. Phase two finishes the CHS HVAC project and addresses outdoor lighting, parking lots and sidewalks at CHS.

The third phase of the capital improvement plan will address air control system upgrades, water and drainage pipes and the new addition at Sheckler Elementary School, the Alumni Field restrooms and starting either the new build or renovation at Catasauqua Middle School. The CMS renovation or new building is listed as the planned project for phases four and five.

Phase one is currently in motion, and Wallace reported the timeline for borrowing and projects for the other phases are not set in stone and may change based on the economic climate, financial standing and board decisions.

According to Wallace’s presentation, overall revenues are seeing a 3% increase, with a 1.99% local increase, 1.78% state increase and 0.65% federal increase.

Wallace reported the federal revenue increase is due to the district drawing down on school-based medical access funds it has accumulated over the years. She said the district will continue to bill and be reimbursed for School Based ACCESS Program services so funds will not be depleted, but, with the decrease in ESSER funds, the expected decrease in Title I funds and the general unknown of federal funding, it was deemed appropriate to use the funds to supplement federal funding losses.

Without the school-based medical access funds, the district would have a 1% decrease in federal funding, Wallace reported.

The governor’s proposed budget includes a potential increase of $114,507 in basic education funding and $13,848 in special education funding for CASD. The district’s adequacy and equity share is proposed at $59,424.

Wallace also estimated the district will receive a similar amount in safety and security grants as it received for the current year. The governor’s proposed budget also includes $125 million in school facilities grants that can be applied for in a competitive process.

Superintendent of Schools Dr. Christina Lutz-Doemling gave a brief overview of events happening at the federal level regarding President Donald Trump’s executive orders and changes to the Department of Education. She noted the dismantling of the federal Department of Education must be passed through Congress, and they have the power to protect public school funding. An executive order is not law, and, at this time, the direction districts were given was to budget status quo for 2025-26.

It was also noted, should the dismantle pass through Congress, lack of oversight could result in redirecting funds in other directions, possibly away from public schools, resulting in fewer resources and no accountability. Additional cost saving actions may be considered, if necessary, it was reported. Other federal proposals include capping Medicaid spending or reducing the federal match. These proposals would shift the financial burden of providing school-based health services.

According to Wallace, Title I funds have decreased the past three years and are projected to decrease again.

The budget presentation noted 67% of the district’s revenues come from local sources, with 31% from the state and 2% from federal sources.

Expenditure factors include contracted salaries, Social Security retirement, health care and insurance increases, projected inflation costs, special education services, mental and behavioral health services, charter school tuition, cost of doing business, general maintenance, an additional elementary learning support teacher, three school resource officers and capital projects. It also takes into account the loss of federal revenue and the elimination of the freshman focus teacher.

Salaries, benefits, debt service and districtwide operations account for 79% of the expenditures. Tuition for charter school, Carbon Lehigh Intermediate Union 21, Lehigh Carbon Community College, Lehigh Career and Technical Institute and more are 16%, with contracted services, transportation and athletics and activities accounting for 3%. Supplies and other rounds out the last 2% of the expenditures.

The presentation demonstrated the imbalance in special education funding and costs. The funding for 2025-26 is $1,385,009, but the total budgeted cost is $7,382,118, leaving a difference of $5,997,109. The costs have been steadily increasing, but the funding is not keeping pace, according to the presentation.

There is also an expected increase in English learner students, homeless students, speech students and Salisbury Behavioral Health needs for the 2025-26 school year.

Capital projects and purchases for 2025-26 include the CHS roof, HVAC, gym bleachers and railing repairs, basketball hoop repairs and the volleyball net system, the concession stand roof, the athletic washer and dryer, waterproofing at Sheckler, CMS waste pipe clean-outs, district office staff computers, a transportation van and routine summer maintenance projects.

Wallace’s presentation reported district enrollment for the 2024-25 year is the highest it has been in 14 years, and Sheckler Elementary’s enrollment is the highest in 21 years.

Charter school numbers are also expected to rise, with 160 students in regular education and 53 in special education. The 213 students is an increase from the 205 charter school students for the 2024-25 year. Costs are expected to be $15,000 for regular charter school education and $38,000 for special education.

The CASD Cyber Academy remains an option for students. There is online learning support provided and creative scheduling for credit deficient students. Students in the district’s cyber academy are also able to participate in district sports and field trips and still graduate with the CASD diploma.

The district’s current fund balance is $5,894,588. Of that, there is $2,800,000 committed for anticipated future capital projects and $3,094,592 unrestricted and available to use on the board of education’s discretion.

Wallace noted the goal is to maintain and continue growing a healthy fund balance to help offset borrowing for future capital projects and capitalize on investment opportunities.

Wallace emphasized these projected numbers are based on the information they have at this time, and adjustments will be made during the next few months.

The proposed budget approval is expected in May, with the final budget approval set for June.