Perhaps something for the library or lunchroom/cafeteria? Maybe a particular series of books, a shelf, or a painted mural?
When I was in elementary school in the 1970's, we had an exceptional art teacher. Every 3 years she would have the 4-6th graders work on a mural. That way each student had an opportunity to help with a mural sometime while they attended that school.
The murals were huge - varying in size dependent on the space available. I remember some being 12 feet tall/12 feet wide, some were probably 5 feet tall and 30 feet long .... and made from a myriad of found objects -- tile pieces cut up, broken china and glass pieces, small toys, old jewelry, you name it, it was in there and placed together mosiac style with some sort of grout. Students were encouraged to bring stuff in throughout the year.
Bit by bit the design would be drawn on plywood (using an overhead) and then the gluing would begin. The last piece was usually glued in on the last day of school. We couldn't wait to come back and see it mounted on the wall at the beginning of the next school year!
That was 30+ years ago and the murals are still there! I haven't been back in years, but each mural brings back a flood of memories. There is giant American flag with the names of each of the 50 states in the stripes, a zoo-like scene (I made the squirrel in the tree; still remember

), and a 5-6 others. She went blind in the early 80's, so her art teaching career ended - but her art has certainly lived on! Wow, that was fun to remember, thanks!
Other ideas ... playground equipment. Large equipment is VERY expensive, but maybe your school could use new soccer balls or 4-square balls? If your playground is paved, but not painted, perhaps hopscotch grids could be painted? Maybe 4 square blocks?
I remember when I was in 8th grade, our class bought 5-6 beanbag chairs for the library. That was a HUGE deal and fun for everyone. I recall you had to sign up to use them that first year so that everyone had a chance!
Have fun planning and executing your PTO project!