Column: MCCSC's funding already got a big boost. Why is Hauswald saying it needs more?
In a recent Herald-Times column, Louise Schlesinger referenced the lack of transparency in the Monroe County Community School Corporation’s $6 million proposal to provide pre-k for 3- and 4-year-old children. She makes clear that this lack of transparency reflects a shocking lack of necessary planning for successful implementation of the MCCSC’s signature referendum initiative.
However, there is also another problem with the proposed referendum. At the MCCSC school board meeting on May 23, and again at a meeting on May 24, Superintendent Hauswald argued that this second referendum in two years is necessary because of the effect of HEA 1499-2023, an Indiana law passed in 2023, that will “usurp the will of the local community” by limiting the growth of funding available from the 2022 referendum. Therefore, it is useful to examine the actual effect of HEA 1499-2023 on MCCSC funding. A cursory examination will reveal how misleading Hauswald’s claim is.
HEA 1499-2023 places a 3% limit on growth of the levy (i.e., the total amount of tax funds raised) in 2024 from any referendum tax adopted before Jan. 1, 2023. There is nothing unusual about such limits on the growth of local property taxes.
Growth limits: What to know about MCCSC's new $9M referendum proposal
The Indiana Department of Local Government Finance sets such limits annually under IC 6-1.1-18.5-2, in the form of a “maximum levy growth quotient,” for local property taxes generally. The growth quotient limits the impact of rising property values on tax inflation. Such limits do not usurp the will of the local community but are adopted to protect taxpayers from unintended growth in tax revenues. There is no reason this principle should not apply to referenda taxes as well.
Moreover, despite Hauswald’s protestations, MCCSC funding has grown dramatically. According to the Department of Local Government Finance Budget Order, the MCCSC referendum levy in 2022 was $7,293,055. After adoption of the 2022 referendum, the MCCSC referendum levy grew to $17,377,238 for 2023. To support this growth, the tax rate rose from 9.05 cents per hundred dollars of valuation to 18.5 cents. HEA 1499-2023 would permit this levy to increase again in 2024 by as much as 3%. Note that HEA 1499-2023 would not reduce taxes, but only limit their increase due to increases in property values.
But despite this, the MCCSC is now asking for an additional $8.5 million in referendum taxes, which would raise the levy to $25,877,238, and the supporting tax rate to 27 cents per hundred dollars of valuation. Hauswald claims that the numbers will be slightly lower than this in 2024, due to a decline in the MCCSC’s debt service. According to his claims, this would lower the levy by approximately $4 million, to a total of approximately $22 million. This still represents an increase in referendum funding over a two-year period of over 200%.
And let’s not forget that referendum funding makes up only a part of the MCCSC’s budget. In 2022, its total budget was $46,844,018, but in 2023 it was $60,859.196. This represents an increase in overall funding of $14,015,178 in a single year, before consideration of the possible effect of tax inflation and the new referendum request on 2024 funding.
It is difficult to avoid the conclusion that the MCCSC’s appetite for new taxes is a prime example of why laws like HEA 1499-2023 are necessary. This undisciplined appetite, combined with its lack of planning for successful implementation of its non-existent pre-k program, reveals the MCCSC’s complete failure to understand what it means to be a faithful steward of the public trust. It is time for the MCCSC to be held accountable, and I therefore encourage voters in the city and county to vote "no" on the upcoming referendum.
Ralph Gaebler is the father of a MCCSC graduate and a long-time Monroe County resident.
This article originally appeared on The Herald-Times: Column: MCCSC's budget has increased $14M. Why does it need more money?
