The books have been formally closed on the 2008-09 budget year in the Steel Valley School District and the numbers aren't pretty.

Mark Cherpak, director of operational services, said the district's deficit for the year, according to its independent auditors Maher Duessel, is $381,942.

Softening the blow somewhat is the fact that the district started that school year with a surplus of $243,000. That leaves a current deficit of $138,942.

The news was disappointing, Mr. Cherpak said, as he and school directors had hoped to have a slight budget reserve for the current school year.

"We have no fund balance, and we are now in the negative," Mr. Cherpak said.

Earlier in the year, Mr. Cherpak estimated the district would have a reserve fund of about $323,000, which included the $243,000 surplus carried into the 2008-09 budget year plus an $80,000 surplus he thought the district would have from the 2008-09 budget.

But in August, when the board was forced to take out a tax anticipation loan to meet its payroll because local tax revenues were slow in coming in, Mr. Cherpak warned school directors a surplus might not be left after all.

At the time, he said he wouldn't know for sure until the independent auditors closed the books on the 2008-09 school year. That closing occurred within the past week.

Mr. Cherpak said the main reason for the deficit is the fact that delinquent tax collections were $380,000 below projects in 2008-09.

And, he said, it appears the same problem could occur this year.

"Our year-to-date collections are below what we thought they would be on the delinquent side, and we could end up with another big hole in the budget," he said.

He said the district recently initiated an amnesty program for homeowners who are delinquent on their property taxes. With that program, those who pay their delinquent bills will have the interest on the late bills forgiven.

But so far, Mr. Cherpak said, not many taxpayers are taking advantage of the program.

He said representatives from the district's auditing firm, Maher Duessel, will make a formal presentation on the district audit to the school board in December.

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