WARMINSTER TOWNSHIP, PA — Faced with an estimated deficit of $10 million in the 2026-2027 budget, the Centennial School District is outlining a cost-saving plan.
The Centennial School District is informing the community that the district is working through major financial pressures as it heads into the final two months of the school year.
School officials said the district faces an estimated budget deficit of about $10 million with no tax increase, and a $7 million deficit if a 3.5 percent tax increase is implemented.
In a letter to the community, Finance Committee Chairwoman Karen M. Simon Krieger and Schools Superintendent Abram M. Lucabaugh said the district has been reviewing rising costs in special education services, transportation, healthcare, and other operating expenses.
The administrative team, the Board of School Directors, and the Finance Committee have been studying the shortfall over the past several months.
School officials said the deficit developed over several years because of rising operational costs, unfunded initiatives, and revenue growth that did not keep pace with those obligations.
District leaders said the response will require careful review of spending and how resources are allocated to district priorities.
School officials said the district has five primary targets that will save $3.2 million in the first year and recurring savings in later years.
These are the cost-savings targets:
1. The largest item is a Transfer of Entity agreement with the Bucks County Intermediate Unit.
The district said two full-time autistic support classrooms at Davis Elementary now operated by the Bucks IU will be brought under district operations, with anticipated savings of $1.2 million, school officials said
2. Centennial also said it will adopt zero-based budgeting for the 2026-2027 fiscal year and beyond.
Under that approach, each department will build its budget from the ground up and justify expenses, while identifying an approximate 10% reduction from the prior year by removing costs not considered essential to the district's core mission.
The district estimated $150,000 in savings from that change.
3. Other measures include a strategic review of staffing and scheduling, with anticipated savings of $600,000, and a retirement incentive program projected to save $750,000.
4. The district said the staffing review is intended to align staffing, course offerings, and scheduling with student needs and enrollment, not to reduce student opportunities.
5. The fifth initiative is an audit and adjustment of internal processes tied to Pennsylvania's Medical Access Billing program.
Centennial said that is not a cost-saving measure but could generate $500,000 in anticipated revenue by recovering funds for eligible health-related services already provided to students.
“A deficit of this magnitude will not be resolved in one budget cycle; therefore, our priority is to address the district’s financial challenges over the next three years while continuing to provide the rigorous, high-quality educational opportunities our students deserve,” Krieger and Lucabaugh said in the letter.
They said updates will be shared in the coming weeks, and Lucabaugh will attend upcoming Home and School meetings to present the budget solutions and answer questions.
(Centennial School District)
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