Yes, cost increases are annually projected and planned for by the school district. Historically, two forms of revenue have been used to meet the increasing costs: the Basic Education Subsidy and local property taxes. Unfortunately, for the first time in over a decade, the Basic Education Subsidy will most likely be reduced by the Commonwealth. This reduction will be explained today by Governor Corbett in his budget address. The expected amount of the reduction is anywhere between $600,000 and $800,000. Local property taxes can only be raised 2.1%. This only generates approximately $83,000 in new revenue for the school district. The district will attempt to reduce expenditures as much as possible to counteract a reduction in revenue.