The Indiana Legislature is considering a bill that could potentially benefit the Vigo County School Corp. when it conducts a referendum to upgrade or replace high school facilities.
House Bill 1045, which relates to information on the referendum ballot, is also a priority of the Indiana School Boards Association, said Terry Spradlin, executive director. Its author is state Rep. Jeff Thompson, R-Lizton.
The bill would allow language that clarifies to voters the net tax rate impact of a project after accounting for retirement of existing debt.
The bill has been assigned to House Ways and Means, but so far, no hearing has been scheduled.
A school district would have to pass a resolution for this information to be included on the ballot.
“The only scenario for which this applies is if the school district is retiring existing debt, and therefore the net impact of the proposed project will be reduced,” Spradlin said. For example, if a project cost 75 cents on the tax rate, but a district expected to retire 25 cents, the net impact would be 50 cents.
Currently, the ballot question must include three pieces of information: a description of the project, the estimated total cost and the estimated increase to the property tax rate for debt service per $100 assessed value.
The change provides voters with information about the fiscal management of the school corporation “and if [districts] are being responsible and frugal in retiring existing debt,” Spradlin said.
The bill deadline for a House Ways and Means committee hearing is this week, Spradlin said. If none occurs, there might be an opportunity to amend it into another bill. If it doesn’t pass this session, “We’ll pursue it again next year.”
The bill is an ISBA priority because “we want to provide optimal conditions for a school corporation to be able to propose and pass a referendum,” he said. “We do think this is valuable information that taxpayers and citizens should have available to them to make a more informed decision.”
While districts will agree to maintain a certain debt service tax rate, the bill does provide exceptions in the case of emergencies or safety/security issues that would require the district to issue debt for projects.
One of the challenges in drafting the legislation is ensuring language on the referendum ballot is “concise and accurate,” Spradlin said. “I think the bill accomplishes that.”
Vigo County School Board member Alpa Patel, who serves as a liaison to ISBA, says the legislation, if passed, could benefit the school district. “We have been retiring debt and we had a presentation at one of our board meetings about how it has put us in a good position for a referendum,” she said. “It would be nice to have that language on the ballot.”