As 2024 draws to a close, local municipalities have been finishing up work on their fiscal plans for 2025, setting budgets and tax rates for the new year.
Among the six Centre Region municipalities — State College Borough and College, Ferguson, Halfmoon, Harris and Patton townships — four have approved real estate tax increases for 2025. College, which still must approve its final budget on Dec. 30, and Halfmoon Township do not have a tax increase.
At the county level, Centre County’s proposed 2025 budget, scheduled for adoption on Dec. 31, contains no tax increase for the 15th consecutive year.
Here’s a look at the 2025 budgets and tax rates around the Centre Region.
STATE COLLEGE BOROUGH
Millage rate: 22.880
Change: 3 mils
The 3-mil property tax increase in State College’s $77 million budget is the largest among the Centre Region. The increase comes as State College works toward achieving in the next three years a balanced budget that does not rely on one-time funds to cover recurring expenses.
Two mils of the increase would go to the general fund, generating $1.16 million in new revenue, and 1 mil would generate an additional $582,185 for the capital fund.
For a residential property with a $300,000 market value and no homestead exclusion, the annual real estate tax increase would be $159.29, or $13.27 a month. With the homestead exclusion, the increase would be $84.29 annually, or $7.02 monthly.
A $400,000 market value property with no homestead exclusion would have an increase of $212.39 annually / $17.70 monthly, and with the exclusion it would be $137.39 / $11.45. For a property with a $500,000 value, the increase is $265.49 annually / $22.12 monthly without the exclusion or $190.49 / $15.87 with.
The average market value for single-family homes in the borough is $384,946.
The borough’s proposed budget is, for the third consecutive year, structurally unbalanced, with projected general fund expenditures of $40,574,496 and recurring revenues of $38,144,587. It will use $2,429,909 from reserves to cover the gap.
State College did not have a tax increase for three of the past four years as administrators and elected officials sought to lessen the financial impacts of COVID-19 on residents and because of large, unrestricted fund balances from COVID relief money. But long-term projections for pensions and capital projects, along with the borough’s own policy, will require a structurally balanced budget in the next several years.
“The borough will plan to achieve a structurally balanced general fund budget by 2027 using both real estate tax increases and other revenue,” Borough Manager Tom Fountaine said at a Nov. 12 council work session, adding that he expects a tax increases in 2026 and possibly in 2027.
Fountaine called it a “very status quo budget” with many capital projects and purchases delayed until 2026 or later because of the structural imbalance. The “major cost driver” in the proposed budget is employee benefits, which will include a a 19.4% increase in group health insurance.
Despite some earlier, sometimes contentious debate over filling staff vacancies and at what level, Borough Council unanimously approved the 2025 budget at its Dec. 16 meeting. Council President Evan Myers said he would work with Fountaine to have discussions of budget issues throughout the year in 2025 to plan for 2026.
COLLEGE TOWNSHIP
Millage rate: 6.10
Change: None
For the third consecutive year, College Township will have no real estate tax increase in 2025.
Township Manager Adam Brumbaugh said at a Dec. 5 budget presentation that increases of .4 mils in 2020 and .3 mils in 2021 have gone a long way in keeping finances on a good track.
“That has actually served the township very, very well in terms of its financial position moving forward through the year,” Brumbaugh said. “Now being in 2024, moving into 2025, that was a very big key in terms of our ability to manage our finances and keep us in a good financial position.”
He added that the township has allotted the remaining $400,000 from its $1 million in American Rescue Plan Act money to the general fund, primarily to pay expenses for police services in 2024 and 2025.
“Sound planning, reasonably sound policy-level direction and, particularly, our judicious use of American Recovery funds, which was a little different than other municipalities did, and really accurate budget revenue and expenditure forecasts have gotten us to where we are,” Council Vice-Chair Eric Bernier said.
The township’s tentative 2025 budget includes $12.08 million in expenditures and $11.01 million in revenues, with the difference coming from available fund balance. More than a quarter of expenditures — $3.11 million — are for wages and benefits, while 24.3% are for capital projects. Contracted police services from State College Borough total $1.86 million, or 15.4%.
Council will hold a public hearing and vote on approval of the final budget at noon on Dec. 30.
FERGUSON TOWNSHIP
Millage rate: 3.172
Increase: .75 mils
Ferguson Township had not seen a real estate tax increase since 2006, but for every year since 2017 except one, expenses have exceeded revenues.
The .75-mil increase, and an increase in the real estate transfer tax from 1.25% to 1.37% is intended to be a step toward a structurally balanced budget. The Board of Supervisors voted 4-1 to approve resolutions for each increase at its Dec. 3 meeting, with Supervisor Matthew Heller voting no.
The increases were less than the 1.5-mil bump for the real estate tax and .25% for the transfer tax after lengthy reviews by the board.
“We had thoroughly looked at ways to make up the budget shortfall through cuts. We have completely exhausted that,” Board Vice-Chair Jeremie Thompson said. “I think we’ve gone at least 10 or more years without a tax increase, but the reality of the situation is that expenses go up and to continue providing our residents with the services they like and rely upon, the revenue has not kept up with that pace.”
The final operating budget — which passed 5-0 — remains structurally unbalanced, with expenditures of $28.4 million and revenues of $25.6 million. The general fund budget has $18.6 million with recurring revenues of $17.6 million. After board review, the final budget cut or modified several planned expenses.
Supervisor Omari Patterson said the board “cannot wait until September 2025” to begin considering the 2026 budget and will start in January.
“We have a bit of work to do. We’ve got a lot of work to do, quite frankly,” Patterson said. “I think we took the first step by making cuts in the budget as it was presented. There’s a hole though that we dug, still. We got rid of some revenue that probably wasn’t equitably received. This is one step in kind of receiving revenue equitably and we’re gonna work together in ’25 to further get efficient as a team, as a board. This is a leadership step. It’s not something that anybody probably wants to do but it’s something that we have to do. There’s a lot of other municipalities in the same boat.”
HALFMOON TOWNSHIP
Millage rate: 7.37
Change: None
Halfmoon Township residents will again see no change to the real estate tax, which was reduced by 1 mil in 2023 and had no increase in 2024.
The township’s $1.73 million operating budget includes a $1.41 general fund budge hatt uses no unreserved fund balance, as in 2023, or ARPA funds, as in 2024.
The Board of Supervisors approved the 2025 budget at its Dec. 12 meeting.
HARRIS TOWNSHIP
Millage rate: 8.20
Change: 1.5 mils
Harris Township will have a real estate tax increase for the third consecutive year after a 0.3-mil bump in 2023 and a 1.1-mil increase in 2024.
In a budget memo to the Board of Supervisors, Manager Mark Boeckel wrote that the township had for many years used fund balance to avoid a tax increase, and that last year’s 1.1-mil increase, along with money from the health insurance reserve, helped move the budget toward structural balance. Still, he wrote, “rising costs and minimal increases revenue continue to present financial challenges for the township.”
“Relatively flat tax revenues, coupled with increasing operational expenses and the ongoing operating deficit present challenges that can only be resolved by raising taxes, reducing expenses or both,” Boeckel wrote.
The township “went to great lengths to minimize increases within the 2025 budget,” including reassigning one-time projects to the special projects fund and eliminating a number of expenditures throughout 2024, according to the memo. A minimum increase of 1.1 mils would bring expenditures and revenues into alignment.
Supervisors agreed at a November work session to a 1.5-mil increase, noting that it would boost fund balance and prevent larger increases next year.
The board approved 2025 tax rates and a 2025 budget with $4.3 million in expenditures and $4.38 million in revenue and the tax rates at its Dec. 9 meeting.
PATTON TOWNSHIP
Millage rate: 10.9
Change: 1 mil
Real estate taxes will increase for a second consecutive year after a 0.4-mil bump in 2024. The increase is mostly needed because of rising costs and the end of American Rescue Plan Act money, Manager Amy Farkas wrote in a budget introduction
“The increase in tax millage will help us smooth through these increases and continue to provide high quality services to our residents,” Farkas wrote.
Real estate tax revenue is projected to increase by about $1 million to $6.36 million in 2025.
The 2025 budget approved by the Board of Supervisors on Dec. 18 includes $13.4 million in expenditures and $12.9 million in revenues.
Projects on deck in 2025 include completion of a public works facilities assessment, replacement of the municipal building roof and play equipment at Graysdale Park and traffic signal projects along the Atherton Street Corridor and Colonnade Boulevard.
