The Red Lion Area School Board will make its first tax decision for the 2013-14 school year on Thursday.

The board recently got a presentation on next year's budget, one that has a $3.4 million deficit, according to business manager Terry Robinson.

Red Lion will have to decide Thursday if board members want to stay within their 2.3 percent property tax cap set by the state. If they don't, they can seek exceptions to go above that mark, although it wouldn't lock them into using the exceptions.

A 2.3 percent tax increase would equal 0.51 mills, or a $77 tax hike for a $150,000 homeowner. Red Lion raised taxes 1.5 percent this school year.

Robinson said the $3.4 million deficit is in line with the deficit the district has faced off the bat in recent years.

There are no major building projects or other big-ticket items in the budget, as increased expenses for pension contributions, insurance increases and other areas are the culprit.

Robinson said the $3.4 million mark is based on no tax increase and flat funding from the state, as well as a slight decrease in federal revenue.

Red Lion could make up $1 million of that deficit by passing a 2.3 percent tax increase. The district finds out March 1 how many teachers are retiring, which can also directly impact salary expenses.

The board meets Thursday at 7:30 p.m. at the administration center.

-- Reach Andrew Shaw at