Three Elkhart County school districts are facing financial challenges brought on by Indiana’s tax caps, and the only short-term fix lies in the hands of the General Assembly.
Last week the superintendents of the Concord, Elkhart and Goshen school districts outlined how the tax caps, combined with stagnate assessed property values, have withered their property tax revenue, leaving them far few dollars to repair buildings and operate their student transportation programs.
Because of this downturn in revenue, each district is considering cuts to student transportation and continuing to delay needed building maintenance. This is not a cut we would like to see, but given all the alternatives, we would much rather see transportation reductions instead of negative impacts being made to the learning opportunities for students.
The superintendents are looking to the General Assembly for help in averting a transportation crisis in the 2013-14 school year. And we think local legislators should join with legislators from across the state to give serious consideration to a short-term grant option. The superintendents said the General Assembly has helped with grants in the past, and as this revenue drop is continuing this year, the General Assembly should consider continuing that help.
However, a long-term solution will require a growing property tax base. When the recession hit Elkhart County in 2008, it struck with a forceful right hook and a devastating left jab.
First, thousands of jobs disappeared within the span of a few months. Then, because of the lack of jobs, the housing industry plummeted to a depth it had never been to before. Home and property prices declined, few new homes were built and foreclosed homes were seemingly in every block. The result was that the assessed value of property in school districts declined, or was flat.
Also in 2008, Indiana voters approved property tax caps in an effort to control spending by government entities. These caps have limited income for county and city governments, libraries and school corporations.
The wisdom of these caps can be debated until the cows come home, but the fact is the public overwhelmingly placed them into the state’s Constitution in 2010. That means the caps will continue to reshape the way local governments and school districts operate in coming years.
For now, we think the fair and proper way to handle this crisis is just what the superintendents are asking: A short-term infusion of money from the General Assembly. That money may be enough to bridge the gap from our slow-growth economy to a more dynamic economy that many indicators show is just over the horizon.