Elkhart Community Schools may bring in $20 million less in revenue over the next five years, as a result of Indiana’s property tax reform. The school board got an update Tuesday on the impact of Senate Enrolled Act 1.
The amount of tax revenue going into the school district will still go up most years, but Barry Gardner with Policy Analytics said the increases will be smaller, as the legislation’s provisions phase in. “You start looking 2028 and beyond, it’s about a $5 million annual impact, just in those years,” Gardner told board members.
The legislation included more deductions for residential and agricultural properties, as well as changes to the business personal property tax.
That will impact the school district’s operations and debt service funds. Gardner said the smaller growth is a challenge when costs are going up.
“All three major utility companies across the state have passed, either last year and/or planning in this year, rate increases,” Gardner noted. “The district absorbs those. Property and casualty insurance, transportation – all those costs continue to have increases.”
Gardner said the situation is similar at most Indiana school districts. He said the General Assembly may continue adjusting the property tax structure in upcoming sessions.
Adding to the challenge, public school districts throughout Indiana will have to begin sharing their operations fund revenue with charter schools in 2028, which was factored into Policy Analytics’ projections.
Elkhart School Superintendent Larry Huff said the reduced revenue will hurt, and the district will have to make some difficult decisions. “I don’t think the average taxpayer and family member understands what is happening or what is going to happen and the – I’m going to use the word and it may be hyperbolic, but I believe – the destruction that we’re going to do to public schools, based off what’s happening here,” Huff said.
In full disclosure, Elkhart Community Schools holds the broadcast license for WVPE.
