Activity buzzed inside the Greenwood Public Library on a warm afternoon in April.
Local residents browsed through the shelves, picking out the most recent bestsellers and literary classics as well as audiobooks, CDs and DVDs.
Adults were working on the public computers. Displays offered board games and activity kits to learn felting, play bocce ball or take out a pair of special glasses for individuals who are color blind. The library calendar advertised programs to learn the basics of making a podcast and a special event for teens built around the movie “Shrek.”
Over the years, the library has used local tax revenue and programs supported at the state and federal levels to create robust offerings for all residents. Recent legislation threatens all of it.
Major changes to Indiana’s property tax system through Senate Enrolled Act 1 have thrown local governments and entities such as schools and libraries into tumult. Officials expect the newly passed state law to strip the county of $28.2 million in revenue to bring property tax relief to residents.
For the county’s library systems, such lost revenue could mean fewer books, DVDs and other library materials. Popular programs such as storytimes and teen-centric get-togethers will likely face cuts. Free WIFI and the number of public computers may be scaled back. Hours at library branches may be reduced.
“As we work to develop higher levels of literacy in our community, it isn’t just simple story times at stake,” said Cheryl Dobbs, executive director of Greenwood Public Library, in an email. “It is the strategic work of early childhood literacy available to all. It is resources that support and develop good students, successful college graduates, engaged employees, and active seniors. Imagining a community where these investments are not made is frightening.”
The full impact of SEA 1 remains to be seen. But library officials are warning local residents about what Johnson County stands to lose.
“I feel like many local government units are at risk of losing essential elements that make our community a great place to live, work, learn, and play,” said Lisa Lintner, executive director for Johnson County Public Library, in an email. “It’s an incredible disruption, causing additional bureaucracy and undue volatility for insignificant or no real relief for residents.”
Seismic change
SEA 1, authored by Sen. Travis Holdman, R-Markle, was signed into law by Braun on April 15. Among other changes, the bill phases out and replaces the homestead standard deduction and other property tax deductions with credits, caps the maximum levy growth quotient percentage at 4% in 2026 and raises the threshold for business personal property tax exemption from $80,000 to $2 million by 2026.
Property taxes make up a significant portion of libraries’ budgets. According to the fiscal impact statement of SEA 1 created by the Legislative Services Agency, the legislation would reduce public library funding by over $12.2 million in 2026, growing to nearly $16.8 million by 2028.
“Every library in the state of Indiana, no matter what their revenue is at this point, all libraries are going to have to do the same amount of work with less money,” said Julie Wendorf, president of the Indiana Library Federation.
Throughout 2025, the Indiana Library Federation has strongly advocated against the reduction in property tax revenue. Among their concerns made in a statement about SEA 1 is that a lack of comprehensive fiscal analysis has been done to determine the full picture of the financial implications.
Changes also do not adequately address existing library debt and the challenges of the structured repayment of current bonds. Legislation also hinders the ability of libraries, particularly in rural areas, to provide the services and support communities rely on, Wendorf said.
“There’s no planning for the future at this point, because you don’t know what your funding looks like,” Wendorf said. “Libraries are unique in some ways in that they don’t have as many streams of revenue. It’s not our model; we provide our services for free. Where a county or city might be able to raise fees by a dollar here or there to make up some of the loss, there’s no way for libraries to do that.”
Throughout the legislative session, the Indiana Library Federation lobbied at the Statehouse and testified before legislators to emphasize the crisis SEA 1 would create.
“The cut in revenue would really impact libraries, rural libraries especially, where they might not be able to have the same hours or have to let go staff, or even close their doors at some of the smallest libraries,” Wendorf said.
Johnson County Public Library receives 50% of its operating fund from property taxes. The operating fund is how the library pays for materials, digital resources, program materials, facilities maintenance and upkeep, as well as employing a highly trained staff, Lintner said.
Greenwood Public Library received $1.6 million from property taxes in 2024, according to Dobbs. Of those funds, $1.2 million went to the library’s operating funds — representing 54% of revenue for the fund.
“The only thing these funds are not used for is program supplies, which are provided by the Greenwood Library Foundation,” Dobbs said. “These funds keep the lights on, pay for our staff, fix the pipes when they break and purchase all the resources our public depends on.”
Cascading problem
The impact of future loss of property tax revenue on libraries has been compounded by a series of decisions made by the federal government and state legislators since the start of 2025.
In March, President Donald Trump signed an executive order calling for the elimination of the Institute of Museum and Library Services. The independent federal agency, which supports libraries, archives and museums in all 50 states and U.S. territories, provides support for the Johnson County Public Library, Greenwood Public Library and Edinburgh Wright-Hageman Public Library, through services provided by the Indiana State Library.
Those services include the Libby app, allowing residents to download eBooks, eAudiobooks and eMagazines; the academic and research database INSPIRE, and services providing early childhood tips to parents, materials for the blind and visually impaired.
Together with the reduction of funding for the Indiana State Library from this year’s budget bill, it has left local libraries reeling.
“Combined, these have the potential to drastically alter the effective, modern libraries in our communities over the next three years,” Dobbs said. “Even though we have been living lean and trying to prepare for this day for a decade, we will have to be proactive in cutting expenses.”
To compensate for the loss of potential revenue from property taxes, the bill allows local governments to impose local income taxes, or LIT.
Johnson County already has a LIT in place, and the county’s libraries use their share of that revenue, combined with funding from property taxes, to cover most of their costs.
For example, Johnson County Public Library’s operating fund is comprised of 40% from LIT. Libraries receive those distributions from the county government.
But SEA 1 also changes the way library districts receive those tax revenues. Currently, libraries automatically receive those distributions from the county.
Starting in the 2028 budget year, libraries and other non-municipal units will have to annually petition for funding. Not only that, under SB 1, there is a ceiling but no floor to the amount of tax dollars a county council can provide local libraries.
With cuts from SB 1 also coming to counties, a county council could decide to keep all of those tax dollars and not allocate any of them to libraries.
“There is a maximum that can be given to public libraries, but no minimum. This makes budgeting for libraries highly unstable and complicated to plan for the possible impacts,” Lintner said.
Uncertain future
In the aftermath of the legislation, library officials have been forced to make immediate decisions on services. Greenwood Public Library has instituted an immediate hiring freeze and reduced spending on library resources, Dobbs said.
Johnson County Public Library is evaluating every vacant position and combing the budget to find new efficiencies to trim their budget in coming years.
“The county council will determine the future changes to LIT, and JCPL will need to prepare multiple budget scenarios and plan for reduced or eliminated services,” Lintner said. “Our JCPL Foundation, our patrons, and staff will advocate for stable and adequate funding to maintain services, buildings, materials, programs and resources.”
In addition to internal planning, a major focus for local libraries has been helping the public understand just how impactful these legislative decisions can be.
“Many people assume that libraries have always been there and always will be. I don’t know that we have done a good job educating the public on how we are funded,” Dobbs said. “Many in our community have been caught by surprise at the impact this may have on us.”
Staff members have also been fielding questions from concerned patrons directly.
“They are afraid of their local library branch closing or reducing hours, less access to materials and resources, fewer programs, and staff reductions,” Lintner said.
But in those concerns, libraries also see the opportunity for patrons to make it clear to county officials how they feel about the services they provide. There seems to be reduced political will to fund libraries for the common good, but patrons can help share their passion for their library to help preserve its future, Dobbs said.
Regardless of politics, the best way to see the value of libraries is to visit one. Some taxpayers may not have visited a library since childhood, and they may be surprised to see all that libraries offer today.
“We invite everyone to come to the library and take a tour,” Dobbs said. “Let us show you what we provide for your community, answer your questions, and tell you about the lives we have impacted.”