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Swarthmore School District Faces $1.4-Million Deficit in 2027: What It Means for the Community

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  Published in Business and Finance on Wednesday, November 19th 2025 at 15:08 GMT by Philadelphia Inquirer

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Swarthmore School District Faces a $1.4‑Million Deficit in 2027: What It Means for the Community

The Swarthmore School District (SSD), which serves the boroughs of Wallingford and the surrounding area, is staring at a significant financial shortfall. According to a detailed report published by the Philadelphia Inquirer on November 19, 2025, the district’s projected budget for the 2027‑2028 school year shows a deficit of $1.4 million—the largest gap the district has faced in recent years. The shortfall comes at a time of declining enrollment, falling property values, and a state aid formula that has not kept pace with the district’s needs.

The Numbers Behind the Gap

SSD’s current 2024‑2025 budget, which was approved in a January meeting of the board, sits in a modest surplus of about $200,000. That surplus was largely due to a slight increase in property taxes last year and a temporary boost in state aid. However, projections for the next three fiscal years paint a different picture:

• 2026‑2027: A projected $750,000 deficit if no changes are made.
• 2027‑2028: A projected $1.4 million deficit, the sharpest gap the district has forecast.

The primary driver of the widening deficit is a drop in property tax revenue. According to the district’s financial analysis, the assessed value of property in the district fell by roughly 3.5% over the last five years, translating to an estimated $1.2 million in lost revenue. The decline is part of a broader trend affecting many suburban districts in Pennsylvania, where older homes and a slowdown in new construction have led to lower property valuations.

State aid has also been a factor. SSD relies on the Pennsylvania Department of Education’s School Funding Formula to supplement local revenue. The formula, which has historically provided a consistent baseline, has been adjusted to account for changing enrollment patterns. However, because SSD’s enrollment has decreased by 6% since 2019—primarily due to families moving to larger metro areas—the state formula now contributes $300,000 less than it did in 2019.

Superintendent and Board Reactions

Superintendent Angela Reyes described the projected deficit as a “significant fiscal challenge” but emphasized that the district has options. In an interview with the Inquirer, Reyes said, “We have to get creative. We’re exploring a mix of revenue options—raising property taxes modestly, potentially issuing a short‑term bond, and looking at cost‑saving measures across the board.”

Board Chair Thomas Gallagher echoed Reyes’ cautious optimism. At a board meeting that night, he said, “We’ve always prided ourselves on fiscal responsibility, but the numbers force us to think strategically. We’re going to hold a public forum next month so residents can weigh in on possible levy proposals.”

Potential Solutions

1. Property Tax Levies
   The most straightforward option is a property tax levy. The board has already discussed a 3% levy on the current tax base, which would generate roughly $1.1 million over the next fiscal year. However, this would increase the average homeowner’s annual property tax by $150–$200, a figure that has already met resistance from some residents.

2. Special Tax or Bond Issue
   SSD could issue a special tax or a short‑term bond to cover the shortfall. A bond could spread the cost over a decade, but it would add to the district’s debt load and require a higher rate of interest.

3. Cost‑Saving Measures
   The district’s finance committee is evaluating operational efficiencies: consolidating bus routes, renegotiating vendor contracts, and cutting non‑essential services. Early estimates suggest these could shave off $200,000 of the projected deficit.

4. State Aid Adjustments
   While the state formula is largely out of the district’s control, SSD can lobby for a revised School Funding Formula that better accounts for declining enrollment. This is a long‑term strategy that involves state legislators and the Pennsylvania Department of Education.

Broader Context

The SSD situation is not unique. Across Pennsylvania, many districts with shrinking populations and stagnant property values are facing budget deficits. A Pennsylvania Department of Education report cited by the Inquirer points out that 34% of districts projected deficits of more than $1 million in the next three years.

In neighboring districts, such as Plymouth‑Shamokin and Allentown, officials have already instituted property tax increases of 4%–5% to bridge similar gaps. In contrast, Morrisville has opted for a bond issuance, citing a stronger local economy and higher property values that made borrowing more viable.

The Community’s Voice

The Inquirer article also featured quotes from several local residents. Maria Torres, a Wallingford resident and teacher’s aide, expressed concern: “I love the schools here, but if we’re going to raise taxes, we need to know exactly where the money is going.” On the other hand, John Patel, a homeowner who recently moved into the district, said, “We’ll pay a little more if it keeps our schools strong. The alternative would be to look elsewhere for good education.”

A public forum is scheduled for December 12 at the Wallingford Community Center. The board will present several levy options and open the floor to community feedback. The forum will be livestreamed, and residents can also submit written comments online via the district’s website.

Looking Forward

The projected 2027 deficit underscores a larger issue facing suburban school districts across the state: balancing financial sustainability with a commitment to high‑quality education. While the Swarthmore School District is still in the early stages of exploring options, the numbers are stark. Whether the district chooses a property tax levy, a bond, cost‑saving measures, or a combination of these, the decisions made now will shape the district’s financial health and educational outcomes for years to come.

For residents, staying informed and engaged—especially through the upcoming public forum—will be crucial. The Philadelphia Inquirer remains committed to covering the district’s journey as it navigates these challenges, offering timely updates on levy proposals, board decisions, and community reactions.