Elkhart Community Schools is considering a referendum to ease its financial difficulties, making it the second school corporation in the county to pursue this method of getting additional funds. In November, Goshen Community Schools won support from voters for $17.1 million.
But what is a referendum, and why are schools around here doing them? Here are five things you may not know about school referenda.
What is a referendum?
A referendum is a way for schools to get extra money through property taxes.
Starting in 2008, Indiana law says that taxes on property are capped at 1 percent for residential properties — meaning that homeowners won’t pay more than one percent of their assessed property value in taxes. Rental and agricultural properties are capped at 2 percent, and commercial properties are capped at 3 percent.
That hurt schools, which rely on property tax money to feed five of the six school budget funds.
Now that there is less money coming in, schools have less money for things such as replacing roofs, paying bus drivers or purchasing new technology for students.
But Indiana law also says that schools can ask people living in its district to pay more taxes over a period of time to help schools out financially. This is done by a vote called a referendum, and a majority of people in that district must vote for it before schools can spend that money.
In Goshen, 61 percent of people at the polls voted “yes” for the school’s $17.1 million plan to renovate parts of the middle school and high school and build a new pool.
Elkhart’s referendum won’t be voted on until the May primary election, if all goes as planned.
How much do I have to pay?
Goshen taxpayers are paying $0.1098 per $100 of assessed valuation over the next 20 years for Goshen schools’ project. That means that if an individual owns a residential property worth $101,500 — the median home price in Goshen — he would pay $37.03 per year, or $3.09 a month on top of the tax cap.
Elkhart schools hasn’t announced yet how much money they will ask for, or how much taxpayers would be asked to pay. The school board will likely make that decision in a public hearing on Jan. 6.
Are other schools in Indiana doing this?
Yes. Since 2008, 42 school referenda have passed in Indiana according to the Center for Evaluation and Education Policy at Indiana University Bloomington. Forty-nine more were proposed, but didn’t gain voter support. The most money a school corporation has won through a referendum is $278 million, won by Indianapolis Public Schools.
What are schools doing with the money?
Goshen schools is using the money to expand cafeteria and music space. The school corporation also plans to build a new pool to replace two aging pools, fix the brick on the outside of the high school, add special education classrooms at the middle school and more.
Elkhart schools hopes to use referendum money to pay for transportation operating costs, upgrade safety features in school buildings and do some repairs and general maintenance that has been put off for lack of funds. The corporation also has two 40-year-old pools and may consider repairing or replacing them as part of the referendum.
How can I find out more?
Elkhart schools will hold a public hearing on the proposed referendum at 7 p.m. Jan. 6 at the J.C. Rice Educational Services Center, 2720 California Road.