By Jason Michael White, Daily Journal of Johnson County staff writer
The Center Grove school board has asked a principal to assemble a group of residents and school employees to promote a property tax hike to retain teachers and staff and to educate the community about the importance of doing so.
Center Grove Middle School Central Principal Jack Parker had volunteered to serve on a committee to educate the public about the importance of a ballot question to ask voters for permission to collect additional property taxes.
School board members later asked him not just to serve on this committee but to lead it. They were impressed with how Parker led a group of about 70 people through the process of identifying priorities for the school district last year.
Now Parker plans to put together a group of 16 to 20 people - half residents and half school employees - to serve on the committee.
The group's first tasks are to recommend how much additional money the school district should ask for and when the request for more money should appear on the ballot.
School board members have yet to make a decision on whether to have a ballot question, called a referendum, because they need to decide on a specific dollar amount and whether to have a special election in the summer or a question on the ballot during the May primary or November general election.
Board members say a referendum is necessary to retain teachers because the district is faced with nearly $4 million in cuts to the general fund, used mostly to pay salaries and insurance.
Forming a referendum committee was one of the top recommendations made by a strategic planning group of about 70 residents, parents and school employees.
About two weeks ago, board president Scott Gudeman asked Parker to serve as chairman of the referendum group. He said he was impressed with how Parker kept discussion moving, on-topic and relevant and showed passion for the school district and its goals.
Timing
School officials are considering three options for the timing of the referendum:
• Have a question on the ballot in May. The issues with this option are how quickly the board would have to approve the referendum and whether board members would have time for proper public involvement.
• Have a special election in July, which would cost about $50,000 to conduct. The problem with this scenario is the school district still would need to trim its staff no later than June 1 in case the special election failed. The law says teachers cannot be laid off after June 1 because of their contracts.
• Have a question on the ballot during the November election and cut staff before June 1 in case the tax increase is voted down. The school district could rehire staff members and teachers if the referendum was approved, but doing so would be complicated during the middle of a school year.
A majority of school board members have said they would prefer a referendum during the May primary, which means the board would need to make a final decision on the referendum, including the dollar amount, next month.
But two school board members have questioned whether a referendum would pass in May.
In May, Center Grove's referendum would be on the same ballot as a jail expansion and a merger between White River Township and Greenwood, both of which would result in property tax increases for Center Grove area residents.
Voters against property taxes could vote no to all three, even if they aren't informed about the issues facing the school district, board member Carol Tumey said.
"An uninformed person might go in and vote no, no, no," she said. "That's my big concern."
Board member John Steed also questioned a May referendum date for the same reasons.
The amount
The need for extra money became an issue after changes were made to the way the state funds schools.
Last year was the first year schools no longer used local property tax money for their general funds, which are used mostly for salaries and insurance, and instead relied on sales tax dollars funneled from the state.
Center Grove was accustomed to 2 to 3 percent increases in funding each year, but for this year, the district was expecting a 0.44 percent increase at most, or about $100,000. And expenses were expected to increase by $1 million because of rising costs including salary increases built into teacher contracts and utility bill increases.
As a result, the school district cut $125,000 from teaching positions, $345,000 from non-teaching positions, $295,000 from support staff and $55,000 from miscellaneous costs. The cuts still left a deficit of $400,000 in 2010, which the district planned to use its cash balance to cover.
The district was expecting even less money from the state in 2011, creating a shortfall of $1.8 million.
Now the financial situation has gotten worse, and a decrease in tax revenue at the state level has forced the governor to cut education funding.
Instead of a funding increase this year, Center Grove now expects a shortfall of $1.9 million in state funding because of the governor's decision. This is in addition to the $1.8 million shortfall that was expected in 2011, meaning the school district needs to cut nearly $4 million from its budget this year.
The school board has formed a financial priorities group to suggest possible budget cuts, and as part of the group's work, its members are to work with the referendum committee to recommend the dollar amount for the school district's ballot question.
A referendum could ask for nearly $4 million to avoid any cuts at all, less than $4 million, which would require the board to still make cuts, or more than $4 million to hire additional teachers or start new programs.
However, school officials need to plan for budget cuts as if the referendum were going to fail; the district can't just sit back, do nothing and hope a referendum passes, board member Mark Dietel said. Center Grove has to have a plan in place in case a referendum is voted down, he said.
If a referendum were approved by voters, Center Grove would collect the additional property tax dollars for seven years, and the property tax increase would not be subject to state property tax caps. To continue receiving additional property tax dollars, school officials would have to conduct another referendum.
Origins
In November 2008, the school board considered asking the public for a property tax hike to pay for building projects.
At the time, school board member Jim Copp spoke to community members who were leery of a property tax hike for bricks and mortar but who said they would be willing to pay higher property taxes for teachers.
He suggested the school district consider a referendum for teacher salaries.
The possibility of a referendum for teachers wasn't brought up again until August, when a strategic planning group of about 70 administrators, teachers, staff members and residents suggested priorities for the school district.
One of the top priorities was a property tax hike, not just to retain teachers but to hire new teachers and start new programs. Possibilities included hiring a science specialist at each elementary school and starting an elementary-school foreign language program.
To conduct a referendum, the strategic planning group recommended that the school district form a financial priorities committee and referendum committee to suggest how much property tax money the ballot question should ask for. The referendum committee was then to gather support for the referendum.
In November, the school board voted unanimously to form the referendum committee, financial priorities committee and three additional committees recommended by the strategic planning group.
But the goal of the referendum changed when the district learned of the budget shortfalls.
Now the referendum is needed not to start new programs but to maintain the teachers and staff the school district already has, Dietel said.
The financial priorities committee started its work last month and will recommend possible cuts the school district can make.
At first, the idea was for this group to work on its own to plan for how much money a referendum should ask for, whether $4 million, more, or less. Afterward, the referendum committee was to focus on educating the public and gathering support for the referendum.
Now the plan is for the financial committee to work with the referendum committee to come up with a recommendation for how much money a ballot question should ask for.
And the board wants a recommendation as to the timing of a referendum.