School district property taxes, a primary funding source for schools, are projected to rise significantly in upcoming years. These taxes totaled $16.6 billion in fiscal year 2022-23, with an anticipated increase to nearly $17.2 billion in 2023-24, marking a 3.2% rise. This increase follows the largest boost since 2018-2019, heavily influenced by a substantial property reassessment in Philadelphia that saw a 31% increase in the assessed value of single-family homes.
Future estimates by the Independent Fiscal Office (IFO) indicate that property taxes will reach $18 billion by 2024-25 and $18.7 billion in 2025-26. These figures represent a revision from earlier projections, which forecasted $17.5 billion for 2023-24, but have since been adjusted to $17.2 billion.
Despite these increases, the proportion of school funding from property taxes has declined, overshadowed by a rise in temporary federal aid related to COVID-19 and enhanced state funding contributions. Local residents, however, continue to face significant burdens, with property taxes for schools sometimes quadrupling the combined total of other local and county taxes.
Moreover, school districts have been increasing their reserves, with unassigned funds in general fund balances growing 61% from 2018-19 to 2022-23, rising from $1.9 billion to $3.1 billion.
