Centennial School District Faces Budget Crisis

WARMINSTER TOWNSHIP, PA — Either way you slice it, residents of the Centennial School District are facing a taxing financial situation.

At a recent special meeting, the Centennial School Board heard a budget workshop presentation in which the finances don't look so promising at this stage of the game.

"We are facing some very significant decisions and some very significant budget situations as a district," School Board President Patti Crossan said at the Jan. 29 meeting. "And this is an opportunity for us to work as a team to work together and decide how is it that we're going to go about solving this. What are we going to do to bring resolution to this issue and to use our resources and our collective desire to serve our students and our district and to bring this full circle."

Chief Financial Officer Tom Greenwood said the school district faces a "widening budget gap" as he outlined a menu of staffing, program, and financial options to shrink the deficit, which he said ranged from $4.1 million to about $10 million.

"As you've seen, the budget process is complex. It is a challenge," Greenwood said. "It is fraught with mandates from the state and federal governments that lack financial support."

In framing the presentation as a dialogue, Greenwood listed three mitigation categories: personnel and staffing; programs and services; and financial strategies.

Greenwood said that local property tax revenue remains the lion’s share of funding, while state and federal revenue have flattened.

He said the school board approved tax hikes within the Act 1 regulations in 2014 and 2020. He said five times between those years, the school board approved hikes that went over the Act 1 setting.

He said that the most recent real estate assessment, dated Dec. 31, showed a decrease in assessed residential value or total value for its three towns of Warminster, Ivyland, and Upper Southampton Township — meaning $400,000 less in real estate revenue.

Greenwood also flagged an expected medical and prescription benefits increase of about 14.5 percent as a significant near‑term cost pressure.

The school board discussed special education and out‑of‑district placements.

Greenwood said the school district pays about $1.6 million to the Bucks County Intermediate Unit (IU) for two Davis classrooms that serve 16 Centennial residents and estimated that bringing those classrooms into district control could save “upwards of $400,000,” with combined savings exceeding $500,000 if additional classrooms (for example at McDonald) were included.

The administration also presented a total out‑of‑district tuition and placement estimate near $9 million for 2025–26 and warned that the IU contracts are tuition‑only while many related services (nursing, PCA, transportation) are billed a la carte.

Schools Superintendent Abe Lucabaugh said any decision to repatriate students would be selective and driven by what is best for each child:

“It is critically important that we keep that student‑centered focus and that we work with families," he said.

Greenwood added that the district would give IU staff a right of first refusal to join Centennial if programs transfer in‑house.

Other strategies presented included nonreplacement of positions through attrition (reallocating sections rather than automatic refilling), a zero‑based budgeting review to separate mandates from discretionary services, vendor consolidation, and targeted grant‑seeking (including the possibility of outsourcing grant writing). Board members asked for a list of services the district performs that are not legally required and for more precise figures on recovered tuition from nonresident students; Greenwood said he would report on collections in the weekly update.

The budget process began in early December.