As state lawmakers look to revisit the property tax reform, Senate Enrolled Act 1, Greenwood Public Library is taking a step toward transparency — warning patrons what they could lose in the future due to this bill.
During a library coffee talk on Nov. 19, director Emily Ellis shared with a packed room full of patrons and concerned community members how libraries are funded and the impact of SEA 1.
SEA 1, passed earlier this year, includes deductions for residential and agricultural properties, as well as changes to the business personal property tax. Changes to local income taxes will take effect in 2028, which could lead to much lower revenues.
Indiana has 236 library districts, and this bill will impact public libraries differently across the state. GPL is sounding the alarm about what they could lose next year, while other local libraries are planning how they will handle future budget reductions.
How are libraries funded?
Most libraries are funded by property taxes from a defined taxing district and local income tax. For GPL, property taxes and local income tax make up about 80% of their budget. For Edinburgh, a little over 30% of its revenue could be affected by the bill.
Libraries have their own special taxing district and its own tax, similar to fire departments, as they are considered non-political in nature, Ellis said. This prevents a politician or political party from having undue control over a public library.
“That is one thing we pride ourselves on is that we are for everybody,” Ellis said. “If you come into this building, no matter your political views, we have something for you.”
However, this past legislative session shows there are some politicians who would like to see more political control over libraries, Ellis said.
At an Aspire Johnson County panel in April, the recently retired former GPL director, Cheryl Dobbs, questioned SEA 1, which would change so that there is no minimum guaranteed funding for libraries through local income taxes. Changes to LITs give counties the authority to decide how much to give to certain districts, within certain guidelines, with libraries not separated from the category listed as “other units.”
“They have a max they can give us, which is less than our current max, all right, but there’s no minimum,” Dobbs said during the panel. “So that, to me, completely politicizes our funding, because it depends on who’s in office at that time and what they think about this library or that library.”
When asked if there were any plans to provide minimum stable funding for libraries, State Senator Rod Bray (R-Martinsville) said the move gives the “power of the purse” to elected officials.
The maximum LIT rate for a county is going to change so that it cannot go higher than 2.9% and local communities could also pass LITs as well, under that cap. Currently, libraries are one of the only entities that are able to set a tax rate that is not run by elected officials; lawmakers want to change that, Bray said.
Ellis said some politicians believe libraries have no accountability, but they do have appointed bodies with multiple people “keeping them in check.” Though no change to the current board make-up has occurred, Ellis raised the concern that a politician may try this to add further controls on libraries in the future.
“Fiscal control over libraries would also give the ability for content at libraries to be politically controlled, so they would determine what could be on our shelves or not,” she said. “I bring this up because I want you to hear it. There are politicians who are trying to move to get rid of our boards and make them locally elected boards.”
Who do libraries answer to?
For GPL, there are several elected officials and bodies at the local and state levels.
One of the entities is the Department of Local Government Finance, which oversees local government, including libraries, to ensure that budgeting and property tax assessments are conducted in accordance with state law.
Ellis said GPL starts researching and building their budget in June and meets with the department to go through their budget.
“They will not let us spend money we do not have,” she said.
GPL also answers to the Indiana State Board of Accounts, which oversees fiscal integrity and accountability of state and local government entities, including libraries.
“We are audited every two years,” she said. “We had a clean audit this year and we upload documents monthly so that the State Board of Accounts has access to our documents at any time.”
There is also oversight that includes the Greenwood mayor, the Johnson County Commissioners and the Greenwood and Johnson County councils. They also have to meet particular standards with the Indiana State Library regarding their operating budget for books and hours of operation each year.
Libraries are also guided by residents of each taxing district who are appointed by elected officials to serve on the library board.
What has changed?
SEA 1 is threatening to permanently reduce and flatten the funding libraries receive from property taxes. Due to property tax caps, libraries will not bring in as much property tax, and they are shifting the funding responsibility to counties, Ellis said.
By 2027, libraries across the state will have no guarantee that LIT funding will be allocated and will have to advocate for funding from their local funding body. For the Johnson County Public Library and Edinburgh Wright-Hageman Public Library, that is the county council; for GPL, that is the Greenwood City Council.
Even at the maximum, which would be .05%, GPL would see about a $170,000 cut. While the bill is still being interpreted, Ellis said it has been difficult to plan the unknown.
The pressure to consolidate has been a topic in the past between the three library districts, but Ellis said taxpayers benefit from the current arrangement for a few reasons.
“They (Johnson County Public Library) would have to take on our debt, which they don’t necessarily want to do,” she said. “We have a reciprocal agreement, so it’s not like they would be filling any hole that we have. We love our autonomy, and I know JCPL loves its autonomy too. We have really gotten to craft a library that is for Greenwood.”
What is the impact?
GPL anticipates losing between $78,000 and $83,000 over the next three years due to property taxes alone, Ellis said, but this will continue to build a gap between the budget and revenue.
The library does have a rainy day fund with a little over $1 million, but with needed maintenance and uncertainty, that will only last so long, she said.
With the loss in funding, this could mean limited hours, fewer programs offered, reduced staff and limited to no digital collections and services.
Starting Jan. 1, GPL will start prioritizing resident cardholders, meaning a majority of their programs will require a GPL library card for registration. A resident library card will also be required to reserve a study room in advance and to extend the time for an additional two hours, and a card will be required to use The Studio Makerspace.
LinkedIn Learning, an online educational platform offering thousands of video-based courses on business, technology and creative skills, will not be renewed as it is a resource that costs the library over $7,000 a year. GPL will also be reducing their digital collections such as Kanopy, Hoopla and Libby.
In 2026, cardholders will have access to eight tickets a month from Kanopy instead of 12, Hoopla will have five checkouts a month instead of eight a month and Libby users could see longer wait times for digital collections.
“It could mean in the end a decline in library quality, the way the building looks and what services we’re able to offer and that’s actually going to be impacted across the state,” Ellis said.
For Edinburgh, library leaders have been working hard to increase their programs and resources at the library with success, library director Denisea Nelson said. The summer reading program saw more than a 40% increase in participation this year, and staff have started multiple new programs recently.
“This significant amount of funding reduction, however, would require us to make some tough choices in deciding which programs and services we would be able to continue offering to our community and which ones would have to be let go,” Nelson said.
As of right now, GPL is in a good place, Ellis said, and she doesn’t foresee any “knee-jerk” reactions in the near future, but is concerned about smaller libraries in the future.
Libraries are much more than just a building filled with books, Nelson said. As community hubs, they provide free resources and information, promote literacy and provide a safe space for community connection and growth.
Nelson encourages lawmakers to visit their local library to get an “up-close look” at what communities would be losing. Ellis had the same sentiment.
“We have always said that if we can get people in the building, we can usually hook them,” Ellis said. “You think of just books, but lives are changed here, and that’s the story we try to tell.”
JCPL currently has no plans for any reductions in services or resources for 2026, but plans to renovate the White River Library in western Greenwood were put on hold.
The countywide library system covering libraries in Franklin, Trafalgar, White River Township and Whiteland shared with the Daily Journal in August how SB1 will impact the library district in the future.
Local income taxes currently account for 40% of JCPL’s operating budget. If JCPL does not receive the full amount possible from local income taxes, it could result in devastating losses and library services could suffer greatly, Lisa Lintner, JCPL director, said in August.
This could include closing library locations, reducing hours, staff, programming, services and resources, she said.
For more information on how residents can help their local library, residents can visit Greenwood Library Foundation’s website, JCPL Foundation’s website, or contact the Edinburgh Public Library at 812-526-5487. Donations likely can’t cover all the expected budget shortfalls, but local library officials welcome all the help they can get from the community.