Property owners in the South Butler County School District will not see a tax increase in the next school year, when their tax bills will be paid to the Knoch School District.

The school board Wednesday approved next year’s budget in the amount of $38.3 million, which will not necessitate a tax increase.

The district’s current millage rate is 94.3 mills. One mill in the district brings in about $182,000.

Revenue in the preliminary budget totals $37.7 million, leaving a deficit of almost $640,000.

The deficit will be covered by capital improvement funds, as the district is in the initial stages of a significant renovation of the aging high school building.

Salaries and benefits, at 68%, continue to represent the largest expense of the budget.

The number of students attending outside cyber and charter schools was set last year at $1 million for the current budget, but that amount is on track to exceed the budgeted amount by more than $524,000.

The line item for cyber/charter schools in 2022-23 has been set at more than $1.5 million for next year. Administrators are hopeful that amount will not be needed as students will return to the district’s school buildings.

An increase in utility costs also is expected in the next school year, and the budgeted amounts have been adjusted accordingly.

As in many school district budgets across Butler County, local sources — mainly real state and earned income taxes — will provide the majority of the revenue next year.

At South Butler County, which will become the Knoch School District in the fall, local taxes provide nearly 57%, or almost $21.4 million, in revenue in next year’s preliminary budget.

State revenue provides more than 41%, or $15.5 million, in revenue.

Federal sources provide just 2% of next year’s revenue, at $772,000.

School boards in Pennsylvania must approve a final budget by June 30.

South Butler is expected to vote on its final version of the 2022-23 budget at its June 15 meeting.