NEW PALESTINE — Southern Hancock schools Superintendent Lisa Lantrip is in favor of growth and development. However, she is raising concerns over tax breaks offered to developers that she says short-change the school district of revenue.

Lantrip expressed her concern on Wednesday, Jan. 19, during the town’s redevelopment commission meeting over the town’s recent approval of a $60 million apartment complex to be built in the area. Lantrip, who is a member of the commission, handed each town official a copy of a letter on the issue in addition to speaking at the meeting.

In the letter, Lantrip wrote that Tax Increment Financing allocation areas adversely affect schools because they redirect property tax revenue — including funds for schools — toward development-friendly investments, such as roads and sewers. In her remarks, she implored town officials to consider handing out tax abatements rather creating TIF districts, which she argued siphon away more funding.

“An abatement is much more friendly to taxing units,” Lantrip said. Abatements give investors breaks on property taxes, which are gradually phased in over a set period, usually 10 years.

Lantrip explained to officials how schools are funded in two main ways.

“The main source of funding is from state tuition support, which comes from the number of students enrolled in our corporation,” Lantrip said. “Second, schools receive property taxes for operational expenses, like debt service, running our school buses, utilities and maintenance expenses.”

She suggested that Rawn Walley, president of the town planning commission, left out important elements when he said recently that the new apartment complex would benefit schools because it would increase enrollment and, thus, funding the district receives from the state.

The money schools collect from the state, Lantrip pointed out, goes into an education fund only and does not cover the operational costs for each student. That leaves tax dollars to pay for the extra costs for bus rides, utilities and anything else not covered in the education fund. That is support that is in part being diverted by TIF.

Walley, presiding over a plan commission meeting the same evening, thanked Lantrip for expressing her concerns.

“TIFs are very important if they’re used correctly,” Walley said in reply to Lantrip. “We all see the concrete warehouses going up and try to wonder where can the people in the town and community get money on those.”

Bill Niemier, president of the town council, suggested the issue lies mostly with state policy that does not adequately fund schools.

“When you look at the level of funding for Indiana schools as compared to other states, we’re still at the bottom, and while it’s nice that the governor has given more monies, it’s still not enough,” Niemier said.

Niemier also noted that the council — which had signed off on the apartment complex — has to balance multiple concerns and that it’s not always easy.

Jim Robinson, New Palestine town manager, said he appreciated Lantrip’s letter and plans to open a line of communication among the town, the school district and other entities affected by tax incentives such as the Sugar Creek Township Fire Department. His plan is to give them a voice in major decisions with an understanding they’re on the same team.

“We need to all communicate a little better,” Robinson said.

Wes Anderson, communications director for the school district, agreed and said the hope behind the letter from Lantrip is to make sure that everyone understands the financial impact of development in the rapidly growing area.

“TIF is an incredibly complex topic,” Anderson said. “Our goal is to make sure we all understand the impact a TIF area has on each of us, because we know it is significant.”
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