EMMAUS, Pa. – The East Penn School District Board of Directors on Monday adopted a preliminary budget with a 4.1% property tax increase.

Officials said the proposed nearly $213.6 million 2026-27 budget remains balanced, but the district faces long-term financial pressure as costs continue to outpace revenue growth.

The budget presents a tax rate of 22.735 mills while continuing a property tax rebate program for eligible residents.

District estimates show that an increase at that level would raise the annual property tax bill by about $194 for the average assessed home currently valued at $216,367 in the district.

Monday’s plan represented a budget that became balanced, in part, by reducing the district’s capital reserve contribution by $1.5 million, said Superintendent Kristen Campbell.

Even with a balanced budget, Campbell warned of a structural deficit and ongoing fiscal challenges.

Early budget talks identified a preliminary budget gap of about $2.14 million for the 2026-27 school year.

“We recognize there is an obligation not just to continue to look at the 2026-27 budget but also to be very mindful about the structural deficit in the budget and attempt to alleviate some of those long-term pressures that we anticipate existing in the budget,” Campbell said.

Officials identified $622,000 in reductions that could be taken but weren’t reflected in Monday’s spending plan. The amount was composed of $150,000 in departmental cuts; $222,000 from losing two support staff positions; and $250,000 from losing two professional staff positions. The positions would be lost through attrition, officials said.

Campbell said those options could be used in future revisions while maintaining class sizes and student support levels.

Board member Joshua Levinson said he supports the tax increase despite it reaching the Act 1 index limit.

“I don’t take that position lightly,” he said, adding the district must continue to streamline operations to avoid “playing catch-up.”

Board President Shonta Ford said officials are working to keep students first while recognizing the impact of any cuts.

“We’re mindful that every decision has an impact on people,” Ford said.