Homeowners in Peters got a sign that the local economy has nosedived: Their school taxes have gone up.

"The economy has gone completely in the tank," said Daniel Solomon, business manager for Peters Township School District, minutes after the school board voted Monday 7-0 to raise real estate taxes by three mills to cover its $46.8 million general fund budget for next year.

With minimal discussion and no debate, the board voted away perhaps the most oft-celebrated distinction of the district: that it featured the lowest real estate tax rate in the county, with schools that outperformed most others in the state.

Board members said no member of the public attended workshops held by the board finance committee, where the budget was discussed at length.

The full board, though, never discussed the hikes during regular meetings, and failed to reveal that a tax increase was likely either in budget literature directed at taxpayers on its Web site or during the passage of a preliminary budget last month.

The preliminary budget called for $47.4 million in spending.

With a new real estate tax rate of 92.5 mills, Peters has the second-lowest tax rate in the county, behind California Area School District, which now boasts a 91.07 millage rate.

The increase means a hike of about $66 per year for a homeowner already paying about $2,000 annually in school taxes. Eligible property owners will get a $123 discount this year from the state through slots gaming revenue.

And the storm may just be beginning, as pension funding requirements are expected to skyrocket by 400 percent beginning in 2012, meaning possible future school tax increases statewide.

A portion of the Peters school tax increase has been devoted to the upcoming retirement requirements, Mr. Solomon said.

And, the outlook isn't much rosier elsewhere in the township, as Peters council has signaled residents that municipal taxes are likely to be raised by as early as next year due to plummeting revenues associated with stagnant real estate development.

Those same revenues -- mostly real estate transfer taxes -- are also affecting the district, which increased its budget by 3.4 percent over last year.

Compared to last year, revenues are down by 1.8 percent, forcing the district to tap almost $2 million from its reserve fund to balance the budget.

Included in the budget is $1.2 million for technology and an $858,000 capital reserve budget.

Mr. Solomon said the district needs to identify a new revenue source to replace real estate development.

On Monday, the board also voted 7-0 to increase administrators' salaries by 3 to 5 percent, totaling $85,800 in new expenses.

Members also approved a new three-year pact with the union representing 28 mostly part-time cafeteria employees that calls for annual raises of about 3 percent.

Members David Hvizdos and John Stepusin were absent during voting.