School Finance

Wayne Township schools say tax hike needed to avoid cuts

PHOTO: Scott Elliott
Wayne Township's Ben Davis High School. The district passed two referenda tonight to avoid staff layoffs.

Wayne Township’s school board said Monday it will ask voters this spring to pass a referendum that would raise taxes.

It’s the only way to avoid cuts, Superintendent Jeff Butts said. The district held off asking voters for money for five years, but the clock ran out, he said.

“We have been operating in a deficit for the past five years because we did to want to go to taxpayers until we’d exhausted all our other options,” Butts said. “There’s an $8 million gap, and we need to make up that gap in one of two ways: we either increase revenue, or we make some cuts.”

The board unanimously backed the plan for a vote on May 5. The district is asking for a 35-cent tax increase per $100 of a property’s assessed value. For a property worth $100,000, taxes would increase by $350 per year, or by $29.17 per month. Butts the average homeowner would pay less than $100 per year.

This is the first time the district has sough a referendum to increase its general fund, which mostly goes toward teacher and staff salaries.

In 2010, Indiana passed a bill to stabilize homeowners’ property taxes, known as tax caps. With the caps now in place, homeowners can’t pay more than one percent of the total assessed value of their property in property taxes. If a home is assessed at 150,000, residents won’t pay more than $1,500 in taxes.

But those caps meant schools lost a primary source of money, so the state allowed school districts to go to local taxpayers to seek voter approval for extra money if they fell short. Wayne Township lost 37 percent of its property tax revenue when the tax caps went in place, Butts said. Only Beech Grove’s 39 percent loss was bigger in Marion County, he said. Wayne Township is the second largest district in the county behind Indianapolis Public Schools.

Supporters of the tax caps believe they offer much-needed relief to homeowners who have seen property values vary widely in the past. But the cap’s critics think it cuts off a viable way for districts to pay for services for students.

Board member Shirley Deckard had no qualms about asking her fellow board members to let the issue go to voters.

“As a retired citizen on a limited income, I ask without hesitation that we pass this resolution for our children in Wayne Township,” she said.

If approved, the new taxes would be in effect for the next seven years.

Butts said if the ballot issue does not pass in May, the district will still have time to discuss where cuts need to be made. Most likely, he said, it will mean layoffs. But he hopes the community’s vote falls in line with responses he’s heard from residents who say local schools are important to them and help maintain the value of their homes.

“This is our new reality,” Butts said. “We need to ask if taxpayers understand the value of the connection between school and community.”


after parkland

Tennessee governor proposes $30 million for student safety plan

Gov. Bill Haslam is proposing spending an extra $30 million to improve student safety in Tennessee, both in schools and on school buses.

Gov. Bill Haslam on Tuesday proposed spending an extra $30 million to improve student safety in Tennessee, joining the growing list of governors pushing similar actions after last month’s shooting rampage at a Florida high school.

But unlike other states focusing exclusively on safety inside of schools, Haslam wants some money to keep students safe on school buses too — a nod to several fatal accidents in recent years, including a 2016 crash that killed six elementary school students in Chattanooga.

“Our children deserve to learn in a safe and secure environment,” Haslam said in presenting his safety proposal in an amendment to his proposed budget.

The Republican governor only had about $84 million in mostly one-time funding to work with for extra needs this spring, and school safety received top priority. Haslam proposed $27 million for safety in schools and $3 million to help districts purchase new buses equipped with seat belts.

But exactly how the school safety money will be spent depends on recommendations from Haslam’s task force on the issue, which is expected to wind up its work on Thursday after three weeks of meetings. Possibilities include more law enforcement officers and mental health services in schools, as well as extra technology to secure school campuses better.

“We don’t have an exact description of how those dollars are going to be used. We just know it’s going to be a priority,” Haslam told reporters.

The governor acknowledged that $30 million is a modest investment given the scope of the need, and said he is open to a special legislative session on school safety. “I think it’s a critical enough issue,” he said, adding that he did not expect that to happen. (State lawmakers cannot begin campaigning for re-election this fall until completing their legislative work.)

Education spending already is increased in Haslam’s $37.5 billion spending plan unveiled in January, allocating an extra $212 million for K-12 schools and including $55 million for teacher pay raises. But Haslam promised to revisit the numbers — and specifically the issue of school safety — after a shooter killed 14 students and three faculty members on Feb. 14 in Parkland, Florida, triggering protests from students across America and calls for heightened security and stricter gun laws.

Haslam had been expected to roll out a school safety plan this spring, but his inclusion of bus safety was a surprise to many. Following fatal crashes in Hamilton and Knox counties in recent years, proposals to retrofit school buses with seat belts have repeatedly collapsed in the legislature under the weight the financial cost.

The new $3 million investment would help districts begin buying new buses with seat belts but would not address existing fleets.

“Is it the final solution on school bus seat belts? No, but it does [make a start],” Haslam said.

The governor presented his school spending plan on the same day that the House Civil Justice Committee advanced a controversial bill that would give districts the option of arming some trained teachers with handguns. The bill, which Haslam opposes, has amassed at least 45 co-sponsors in the House and now goes to the House Administration and Planning Committee.

Editor’s note: This story has been updated.

More money

What Colorado’s booming economy might mean for the state education budget

More money is forecast to appear below the gold dome (Denver Post photo).

Gov. John Hickenlooper wants to put an extra $200 million into education next year and another $100 million in the 2019-20 fiscal year, but a lot of that money could go to offset hits to districts from anticipated reforms to the state’s pension program and reductions in local tax revenue.

The proposal comes in response to new economic forecasts released Monday that show Colorado having more money than previously expected.

Legislative economists predict that lawmakers will have a whopping $1.3 billion or 11.5 percent more to spend or save in 2018-19 than is budgeted in 2017-18. The forecast from the governor’s Office of State Planning and Budget predicts similar increases in revenue. After meeting the reserve requirement of 6.5 percent, Colorado will have an additional $492 million in reserve for this fiscal year, and even with a higher reserve of 8 percent proposed for next fiscal year, the state would have an additional $548.1 million in 2018-19. 

It’s normal for the forecasts to be slightly different because the economic analysts often use slightly different assumptions. In this case, the governor’s office predicts that the additional revenue will be more spread out over this fiscal year and the next one, while legislative economists think more of the money will be coming in next year. That difference means the legislative forecast shows the state potentially hitting the revenue limits imposed by the Taxpayer’s Bill of Rights, despite lawmakers making more room under the cap just last year, while the governor’s forecast does not.

These are the numbers that the Joint Budget Committee has been waiting for to finalize its recommendations for the 2018-19 budget year. Republicans and advocates for more transportation spending have already seized on the numbers to support a plan to ask voters to approve new debt to pay for road construction and dedicate up to $300 million a year to pay off that debt.

Of course, these forecasts are also inherently speculative – and legislative economists warned these forecasts contain even more uncertainty than usual.

State Rep. Millie Hamner, the Dillon Democrat who chairs the Joint Budget Committee, summed up the message as one of caution about dedicating too much of the new revenue to ongoing expenses. The more that gets committed, the harder it will be for the state to meet all of those commitments in future years.

Those who want to see Colorado spend more on K-12 education have pushed back on the Republican roads bill out of fear that the commitment could make it harder to send more money to schools in the future.

The governor’s budget director Henry Sobanet recommended treating much of this new money as “one-time” funds that should go to “one-time” uses. In a letter to the Joint Budget Committee, he laid out a plan.

In the case of roads spending, he’s recommending an extra $500 million for road construction in 2018-19, but only $150 million in 2019-20. And in the case of education, he’s recommending an additional $200 million in 2018-19 and an additional $100 million the following year.

However, this extra money might not show up in classrooms – or rather, it might show up in a lack of cuts rather than new money.

The governor’s budget request already called for a reduction in the budget stabilization factor of $100 million. That’s the amount by which Colorado underfunds K-12 education compared to the requirements of Amendment 23. In this budget year, it’s $822 million, after a mid-year adjustment. Some of the extra money could go toward reducing it even further.

However, Sobanet said he envisions most of it going to offset reductions in local property tax revenue that will be caused by a provision of the Colorado constitution that governs the ratio between residential and commercial property tax revenue.

It’s also possible that school districts could end up having to pay more toward some sort of agreement on changes to the Public Employees’ Retirement Association, or PERA. The final form of reforms to PERA is far from certain.

“Another downgrade in the residential assessment rate means more state share to keep total per pupil spending up,” Sobanet said. “We know that since the December announcement of property taxes and since we know PERA might be on the table for something, let’s set aside some resources and make sure we can handle this.”