Wednesday, September 17, 2014


Kids at Mary Daly Elementary in Elkhart board buses for their ride home on Feb. 12 2014. The transportation budgets of Elkhart County schools have been hit hard by reductions brought on by tax caps, but a new law might help with that. (James Buck / The Elkhart Truth, File)

Kids at Mary Daly Elementary in Elkhart board buses for their ride home on Feb. 12, 2014. The transportation budgets of Elkhart County schools have been hit hard by reductions brought on by tax caps, but a new law could help with that. (James Buck / The Elkhart Truth, File)
Local schools could see a property tax cap relief under new state law
Posted on March 29, 2014 at 2:36 a.m.

A new state law could help local schools struggling under property tax cap losses. 

In 2012, Indiana lawmakers voted to force schools to pay two debt funds with property tax revenue before putting money in other funds — like transportation, bus replacement and capital projects.

That means that schools that are short money because of the caps would still have to pay the regular amount to the debt funds, as if they had all the money they needed. 

Then schools would have even less money to work with when they got to the transportation, bus replacement and capital projects funds.

That mandate was set to go into effect in July, but a new law signed by Gov. Mike Pence last week gives a three-year reprieve to districts expected to lose more than 10 percent of their property tax funds, according to the Associated Press.

Doug Hasler, executive director of support services for Elkhart Community Schools, thinks Elkhart would fall into that category.

And if it does, the law could ease some of the worries school administration has about predicted tax cap losses for 2014.

But tax cap losses have been steadily increasing each year for Elkhart Community Schools, Hasler said, so the new law's reprieve only goes so far.

"While the relief provided in this statute would be welcome, the increasing tax cap losses pose a greater challenge for us every year," he said.

Concord is another school district that's been hit hard by property tax cap losses. 

District administration believes the school corporation may lose 68 percent of its property tax revenue in 2014.

Superintendent Wayne Stubbs said Friday that the new law allowing schools to pay all funds evenly instead of protecting the debt funds is something administration has "hoped and lobbied for."

But he pointed out that the reprieve is only for three years and it doesn't lessen the school corporation's total losses of property tax revenue.

To recover some of those losses, Elkhart and Concord will have a referendum on the ballot in the May 6 primary election. The referendum will allow taxpayers to vote on a tax hike that would give more money to the schools.

The Associated Press contributed to this story.