Indianapolis Public Schools said Thursday it will need to cut $27 million from its 2012-13 budget due to declines in state funding and local income restrained by property-tax caps.

The cuts represent about 5 percent of the school system's current budget. IPS Superintendent Eugene White said he will detail his spending-reduction plan on May 24 at the IPS central office building.

In a statement released Thursday afternoon, IPS officials said they would cut staff and find savings in contracts for supplies and services, such as bank fees, professional services charges and travel expenses.

IPS emphasized no cuts would be made in art, music and physical education programs.

"IPS has pledged to keep cuts as far away from the classroom as possible, and this budget proposal does that," White said in a prepared statement. He added, “We've cut administrators, secretarial staff and police officers to ensure our classrooms have the funds they need to provide a quality education to our students."

IPS said it has cut its general fund budget by $120 million over the past five years as its enrollment as steadily declined and the state government chopped per-student funding in 2010 and 2011.

The district is still the state’s largest, with nearly 32,000 students, but that's down more than 5,000 students from five years ago. Its budget this year totaled about $540 million.