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Voters approve tax hikes to raise more funds for Indianapolis Public Schools

November 6, 2018
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Voters in the Indianapolis Public Schools district have approved the district’s request to raise property taxes in referendums to pay for higher teacher salaries and better school facilities.

IPS said both referendums had been approved by more than 70 percent of the voters, with 85 percent of precincts reporting.

The district’s operating referendum is expected to generate $220 million in extra revenue over eight years. And the district’s capital referendum is expected to raise $52 million in extra funds to pay for upgrades to school buildings.

The operating referendum is expected to boost taxes about $128 a year on a $150,000 home and $574 on a $500,000 home. That equates to 19 cents on each $100 of assessed value.

The capital referendum would boost property taxes about $22 a year on a home assessed at $150,000 and about $97 a year on a home assessed at $500,000. That equates to no more than 3 cents on each $100 of assessed value.

Tuesday's results followed a tumultuous path for IPS in its quest for a referendum.

IPS took months to decide how much it would ask for in the referendums, delaying the votes from the primary to the general election. It also requested advice from the Indy Chamber and initially rejected it before finally determining the amount.

Last December, IPS said it would seek $736 million for operating expenses over eight years. Two months later, it lowered the request to $525 million. In early July, responding to the Indy Chamber’s recommendation that it raise just $100 million, IPS requested $315 million. Finally, the groups agreed on $220 million.

The district's’ request on capital expenses also has been substantially lowered. Initially, the district sought to raise $200 million.

The district says its main priority with the operating revenue request is to pay for salary increases for teachers and staff.  But it also made trade-offs that could have left it financially vulnerable down the road. That included having smaller cash balances, assuming more growth in assessed value, and projecting larger increases in funding from the state.

“Our main thrust has been teacher compensation,” IPS Chief Financial Manager Weston Young previously told IBJ. “To keep compensation [increases], you’ve got to give away something else. As we’ve moved from [each request], what we’ve been taking is a less conservative and more risky approach on our revenue projections.”

Even if the referendum had passed, district officials had warned of other big changes coming down the road for IPS. The chamber has suggested, among other ideas, to realize more efficiencies by increasing class sizes, replacing in-house bus service for high school students with the IndyGo public transit agency, and reducing central office staff by half.

IPS is the largest school district in the state, with 2018-19 enrollment of more than 31,000 students.

This story will be updated.

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