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The Depew School District budget for 2013-14 is likely to contain $869,000 in spending cuts and a 2.63 percent increase in the tax levy.

But Superintendent Jeffrey R. Rabey told School Board members this week that the projected increase in the tax levy “assumes a 3 percent increase in state aid.”

And he noted that the aid increase could be affected by Superstorm Sandy, which might require the state to divert resources to the cleanup and rebuilding.

The budget contains increased costs in three areas: salaries, $526,339; retirement benefits, $402,934; and health care benefits, $296,380.

The district also anticipates savings of $200,000 from relocating administrative offices from the Terrace Education Building to the high school and a $145,000 decrease in bond principal payments.

The district plans to sell the Terrace Education Building, a former elementary school.

Rabey also said the $3 million in reserves will be used in the budget.

“It will be critical for the district to utilize these reserves in a responsible and balanced manner as we plan for the future, avoid insolvency and maintain an annual affordable tax levy increase under the [state’s] tax cap legislation,” Rabey said.

The district is also expanding its budget projections to five years, from three. And Rabey said that the budget increase for 2017-18 would be about 9 percent above this year’s figure.

“This includes the necessary reductions of $5.1 million over the same time period in order to maintain fiscal responsibility and avoid future insolvency,” he said.

In other business, Susan Arena, district business manager, said the district is studying collaborating with the Clarence, Lancaster and Alden school districts on joint bidding for services and supplies.

Some of the things that might be jointly bid include paper supplies, oil and other lubricants, tires and dairy products, Arena said.

The board also approved a $3,000 professional development expense reimbursement for Rabey, as provided for in his contract. He has been enrolled in a doctoral program in leadership and policy through Niagara University.