KEENE — The Keene School District has a $2.6 million budget surplus to cushion the local school tax rate this October.

“The school side, it will definitely be positive,” said SAU 29 Business Administrator John Harper on Thursday of the tax rate to be set in mid-October.

“Whenever you have a reasonable surplus to apply, it’s always positive.”

The actual surplus was $2,709,424, before $100,000 was taken out and placed in the building maintenance fund. That appropriation was approved by voters at the district’s annual meeting in March.

The building fund recently paid for an $812,000 partial replacement of the Keene High School heating system, he said.

“It’s a good way to set money aside. Otherwise those funds would just close out at the end of the year.”

The School District was expecting about $1 million less in surplus, Harper said.

“We expected a surplus, but this turned out to be a little bit bigger when we paid all the bills and closed out the books at the end of the year.”

So now the $2,609,424 surplus from the 2011-2012 school budget will go to reducing this year’s property tax rate, he said.

“That’s money that wouldn’t need to be raised in taxation,” he said.

Because officials are about a month away from setting the the tax rate, the surplus’s specific impact is unknown at this time, Harper said.

The overall surplus was the result of a 2 percent or $1.3 million surplus in both the district’s revenue budget and expenditure budget, which were set at $62,732,108 each for 2011-2012.

In the expenditure budget, the district spent about $851,000 less than expected for special education instruction. Harper attributed the savings to a smaller special education student population over the past school year.

On the review side, $318,000 in American Recovery and Reinvestment Act funds designated for education jobs was used to offset increased retirement costs shifted from the state to the district.

The federal money could have been used to create new jobs, but in this case was used to prevent layoffs, Harper said.

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Meghan Pierce may be reached at mpierce@newstote.com.