Three school districts faced with struggling finances are asking voters in their communities to approve property tax increases at the polls Tuesday.
Munster, East Chicago and Lake Station will each ask voters to approve plans that would bring an influx of money to provide services and weather state funding cuts. Munster is also seeking a $48 million capital referendum for building upgrades. Polls are open from 6 a.m. to 6 p.m.
Munster
While Munster works to close its once $8 million budget gap, administrators are hoping voters will approve two referendums to raise operating costs and bring in funds for building repairs.
The School Town of Munster is seeking a .4196 cents per $100 of assessed value for seven years for the purposes of repealing the existing referendum tax fund levy and replacing it with the new referendum tax fund levy that will provide funding to continue current and implement new educational programs, address additional staffing needs including special education and pay raises among other expenses.
The second question asks voters if the school town should enter into a bond or lease to finance the 2017 to 2020 Munster School Building Renewal Restoration Technology Upgrade and Safety project that includes restoration, repair and renovation work at all school buildings. Work is expected to cost no more than $48.175 million and will increase the property tax rate for debt service by .4309 cents per $100 of assessed value.
School officials have said funding would go largely for building repairs and upgrades at Eads Elementary, Elliott Elementary, Frank Hammond Elementary, Wright Middle School and Munster High School.
Earlier this year, a Facebook page called “Concerned Citizens Against the Munster Referendum” was created, that has criticized the move to fund improvements and replace and hike its current operating referendum that passed in 2013 in light of its financial problems in recent years.
In June 2016, two former top administrators were ordered to repay $851,000 to the district after an Indiana State Board of Accounts audit showed years of alleged overpayment.
Superintendent Jeff Hendrix, who was hired in 2014, said last summer the district’s $8 million negative general fund balance from January 2015 was projected to see a $3.2 million reduction by the end of last year to $4.8 million.
Munster has cut staff and administrators in recent years as it attempts to tackle its debt.
During a community meeting in March, Hendrix told audience members that passing the referendum was essential for the district to continue to close its budget deficit, weather potential state funding cuts, retain staff and maintain its outside reputation for academic quality.
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Multiple attempts to reach Hendrix last week via phone with staff and his district email were not successful.
East Chicago
Faced with uncertainty over the financial fallout from the city’s lead crisis, district leaders are seeking a referendum to bolster its finances to help pay for staff and programs.
The School City of East Chicago will ask voters to pay an additional 30 cents per $100 of assessed value over seven years to pay for teaching and staff positions and educational programming. The referendum would raise about $41 million over seven years.
The East Chicago district has taken a nearly $4 million financial hit since last summer when the city ordered the 1,000 residents from Zone 1 of the U.S.S. Superfund site in the West Calumet neighborhood to leave their homes, Superintendent Paige McNulty said in an email. About 30 remained in recent weeks.
Enrollment has dropped by 417 students due to the lead crisis, she said.
“Additionally, we have had to fund things that we were not expecting this year due to the crisis such as water testing for our schools, bussing an additional 400 students, and renovating (the new Carrie Gosch Elementary School) that we were not anticipating,” McNulty wrote. “Our district has been very financially solvent over the last several years and has been putting money directly back into our schools and classrooms and we want to continue doing so.”
Last August, as a precaution, school officials shuttered the neighborhood’s Carrie Gosch Elementary after EPA officials said a portion of the parking lot on the school’s southeast side needed remediation. The district owes $2.2 million on the former Carrie Gosch building, McNulty said. It has received multiple inquiries, but no solid offers to date.
The school district took out an emergency state loan around $2.8 million to refurbish a former middle school, which reopened as the current Carrie Gosch Elementary building last year.
It still owes that money to the state. Unless the loan is forgiven, it will begin repaying it in January 2018, she said.
Sen. Lonnie Randolph, D-East Chicago, said he would plan to again introduce legislation in the future asking the state for loan forgiveness.
During the legislative session, lawmakers introduced some relief for East Chicago in the state budget including a measure that freezes its average daily membership (ADM) — or enrollment count that determines state aid at 2015-16 levels, before the exodus of families in the West Calumet neighborhood.
That enrollment count freeze will be in force through 2017-18, which determines state funding for the 2018-19 school year.
Lake Station
With the exception of the Gary Community School Corp., no local district is edging over the fiscal cliff faster than Lake Station.
Without support from voters in Tuesday’s general fund referendum, students in the small school district are facing the loss of bus transportation and the closure of an elementary school. In addition, there will be staff layoffs and diminished academic and extra-curricular programs.
Voters will be asked to vote “yes” or “no” on allowing the school district to impose a property tax rate that does not exceed 54 cents on each $100 of assessed valuation to maintain and expand academic programs, teaching positions, student safety, bus transportation and other educational needs.
The referendum would span a seven-year period and raise an estimated $5.6 million or about $800,000 a year. The owner of an average home, valued at $80,000, would pay $108 a year more in property taxes if the referendum is approved, according to Superintendent Tom Cripliver.
A combination of reduced state funding, enrollment declines and property tax caps have decreased the district’s budget dramatically, officials said.
Cripliver said the district opened its enrollment to entice students from other neighboring districts to enroll. That’s increased enrollment by 24 students.
Enrollment has dropped 12 percent since 2012 and that’s resulted in a $738,568 loss in state funding, according to chief financial officer Eric Kurtz. The district’s enrollment is about 1,300 students, he said.
The legislature wasn’t generous to the district in its two-year budget that begins July 1. It’s looking at a 3.1 percent state funding cut in 2017 and 4.1 percent decrease in 2018, Kurtz said.
Lake Station unsuccessfully sought passage of an operating referendum in 2015 that was soundly rejected by voters.
“It’s up to Lake Station voters to decide how they want to support local schools,” said Kurtz. “We’re not sophisticated enough to do polls. … We’ll wait till Tuesday to see what voters decide.”
Carole Carlson is a freelance reporter for the Post-Tribune.
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