Yesterday was a big win for taxpayers in the Lower Merion School District.
You may recall that last year Lower Merion School District was ordered to revoke its latest tax hike, saying that the school district mislead taxpayers by projecting large budget deficits as justification for raising taxes. The class-action lawsuit was filed by Arthur Wolk, a lawyer who lives in Gladwyne. The judge in the case determined that Lower Merion School District actually had socked away millions of dollars.
According to the judge’s findings, Lower Merion School District got away with raising taxes above the Act 1 index of 2.4 percent by saying the money was needed to cover soaring special-education and employee pension costs, two of the biggest expenses for most public school districts. It was determined that Lower Merion School District, one of the wealthiest school districts in the Philadelphia area, deliberately over-estimated deficits and failed to adequately predict surpluses; thus allowing the stashing of millions in reserves.
Taxpayers in Lower Merion School District had long complained about the yearly tax increases, as they watched the end-of-the-year surpluses continue to grow.
Lower Merion School District appealed the court decision of August 2016 and we learned yesterday that the lawsuit was thrown out on a technicality – apparently the school district failed to file the motions within the 10-day deadline. Wonder who was responsible for that ‘oversight’ … their business manager, their solicitor Ken Roos? Coincidentally, Roos of Wisler Pearlstine, is also the solicitor for TE School District. In addition to refunding millions of dollars, the taxpayers have the burden of legal fees from the original lawsuit and from the appeal. Wow.
An unprecedented ruling, the win for taxpayers in Lower Merion School District could pave the way for other school districts to follow suit. The following chart shows TESD tax increases over the last thirteen years. And from recent budget workshops, we know the preliminary TESD 2017-18 budget proposes another tax increase. 2004-05 was the last zero tax increase year.
2004-05: Zero Tax Increase
During the last several years, most tax increases have ended up as surplus in the operations of the TESD schools and now those taxpayer dollars are sitting in the District’s fund balance – which is currently $32 million! This is not an argument about adequately funding and maintaining the high level of quality of our schools.
The ruling in Lower Merion School District should provide a wake-up call to all school districts who justify tax increases but end up with surpluses year after year.