TOWANDA - The Towanda Area School Board on Monday voted to put on public display the school district's proposed $22.9 million final budget for the 2012-13 fiscal year, which includes a proposed 1.2 percent increase in the school district's property tax and a proposed 2.4 percent increase in the school occupation tax.

The proposed property tax increase, which would raise the tax rate by .46 mils, is less than half the size of the tax increase that interim Superintendent Donald Butler had proposed at the board's April 16 meeting.

The size of the property tax increase was reduced by relying more heavily on the school district's fund balance and cutting expenses further, Business Manager Doreen Secor said.

"I think this is about as fair and as bare-bones as we can get with our budget," school board President Pete Alesky said.

The school board voted unanimously to advertise that the budget is available for public review.

At its second meeting in June, the school board will adopt a final budget, which is for the fiscal year that begins on July 1, 2012 and ends on June 30, 2013.

To help close a $561,000 funding shortfall in the budget that had existed as of April 16, the school district made $234,500 in cuts to the budget, including eliminating a kindergarten teacher position, eliminating a part-time secretary position, and replacing some staff who are leaving for jobs elsewhere with new hires at a lower salary, Butler said.

The loss of the kindergarten teacher, which will be achieved by not replacing a kindergarten teacher who is retiring, will leave the district with five kindergarten teachers during the coming school year, he said.

Kindergarten class sizes for the 2012-13 school year are projected to be around 20 students each, which is unchanged from this year, Butler said.

Under the proposed budget, a Title 1 teacher would also be assigned to assist the kindergarten teachers with reading instruction.

"We're trying to provide additional services in that area (reading) so that we don't have issues," Butler said.

During the meeting, Butler welcomed the new superintendent of schools, Steve Gobble, who had in the past served as the principal of Towanda Junior/Senior High School. The school board meeting on Monday was the first that Gobble had attended in his new capacity as superintendent of the Towanda Area School District.

The state might provide additional funding to the school district for the coming fiscal year, said Butler, who recommended that any additional state funds that come to the school district be used to reduce the amount that the district is using from its fund balance.

Butler and Gobble are proposing to use $750,000 from the school district's fund balance to help balance the FY 2012-13 budget.

Butler said that the new construction that is occurring in the area, including new hotels, will expand the local tax base and help replenish the fund balance in the coming years.

Butler is also proposing a realignment of the school district's administrative staff, under which elementary Principal Pamela Hosterman would become principal of curriculum and instruction for grades K-12, effective on July 1.

The assistant elementary principal position would be eliminated, and a new full-time elementary principal would be hired, Butler said.

The changes would leave the total number of administrative staff unchanged at five, Butler said, adding that the shift in administrative positions will better meet the needs of students.

The school board will vote next Monday on whether to reassign Hosterman to the new position.

In June, the school board will take a final vote on whether to approve the proposed .46-mil increase in the property tax, which would raise the tax rate to 39.68 mils. If the tax increase is approved, the owner of a home in the school district with a median assessed value of $33,100 will see his or her annual property tax bill increase by $15.23, Butler said. In Bradford County, homes are assessed at half their fair market value.

The school board will also vote in June on whether on whether to approve the proposed increase in the occupation tax rate.

If the occupation tax increase is approved, an individual's annual occupation tax bill will increase by $2.10, $4.19, or $8.40, depending on which of three job categories his job is assigned to.

The school board voted 7-1 Monday to place a legal ad in The Daily Review stating that school district's occupation tax might be increased next month.

School Board Vice-president Bob Fetterman cast the dissenting vote.

"I hate the (occupation) tax with a passion," Fetterman said. Fetterman has criticized the occupation tax as unfair, saying it hit him particularly hard when he was just starting out in his profession.

While the occupation tax increase is being proposed to help balance the school district's budget, school board member Evelyn Sherburne said she hoped the increase will motivate people to vote to get rid of the occupation tax in a referendum that will be on the Nov. 6 ballot.

The referendum will ask voters in the Towanda School District whether they wish to eliminate the school occupation tax in exchange for a higher local earned income tax.

The proposed final budget can be reviewed at the school district's business office.

Following the meeting, there was a reception to welcome Gobble to his new position and to thank Butler for his service. Cupcakes, made by business manager Secor, were served at the reception.

James Loewenstein can be reached at (570) 265-1633; or email: jloewenstein@thedailyreview.com.