Gary school district will ask voters for tax increase

Contributed By:The 411 News

Since the state takeover of the Gary Community School Corporation in 2017, an increase in property taxes has always been a cornerstone of plans to help the district operate.

The school district's managers, Indiana's Distressed Unit Appeal Board and MGT Consulting have delayed pondering the when and how to get it done.

That time is now, MGT's Eric Parish said at Thursday's virtual meeting with the DUAB, to bring the referendum question before voters in the upcoming General Election. "With more voters in presidential elections and the right messaging, I believe we can get it done."

In November, Gary voters will be asked to approve a $48 million property tax increase over an 8-year period to increase operating revenues for Gary schools.

If MGT chooses, charter schools will be allowed a share of the anticipated $6 million dollars a year in increased revenues. New language applied in the 2020 Indiana Legislature gave the host school district that option. Charter schools cannot call a referendum.

In Indiana, referendums to increase property taxes for schools can help pay for teacher salaries, building and renovating schools, and day-to-day operations.

Parish said all the funds will go to support teachers and students. "The first $1 million dollars the Gary school district receives will go to teacher salaries. They have not had a raise since 2010 and were granted a stipend last year, their first in over a decade."

Other education benefits the school corporation hopes will appeal to voters are funds going to programs for students in pre-schools, the arts, and athletics. Schools will see more support for security and safety issues, like mental health and counseling.

If voters had approved the Gary schools 2016 referendum -- failing by 320 votes -- it's very likely the district would not be under state control today. Back then, the school district asked for a $52.5 million property tax increase over 7 years.

If charter schools are allowed to share, the referendum question might attract more voters.

The Indiana Dept. of Education's 2019-20 Transfer Report showed nearly 12,000 school age children, in grades K-12, lived in Gary. Of those, 7,600 did not attend a school operated by the Gary Community School Corp. Charter schools in Gary enrolled about 5500 of those students and the rest were enrolled in charter, traditional public, virtual, private, and faith-based schools in nearby cities and across the state.

Residential properties will see an increase of 44 cents per $100 of their assessed value. Commercial properties will see an increase of 47 cents per $100.

Next for the school district is how to get the referendum done. "We have to educate the voters on the district's acute financial situation. Educate is easy to say. The hard part is how we do it," Parish said. "Opposition is expected. There is a universal distrust of tax increases and the entity asking it."

The DUAB and MGT know there is wide dissatisfaction with their performance in Gary. When MGT Consulting's contract was recently renewed for 2 years, the DUAB stressed the importance of MGT and its own panel improving communications with the Gary community.

State Rep. Vernon Smith, a non-voting DUAB member said he was for the referendum but wanted the DUAB to consider a letter from the West Side Leadership Academy PTSA. West Side parents asked the DUAB to postpone approval of the referendum until there is a public meeting in Gary to discuss MGT's financial reporting.

West Side PTSA President Robert Coleman doubts the district's "acute financial situation." Coleman says the high turnover of emergency managers, chief financial and academic officers have contributed to inaccurate financial reporting.

Coleman is also the 3rd District Advisory Board Representative for the Gary Community School Corp.

MGT has to prepare and have its referendum question accepted by Indiana’s Dept. of Local Government Finance by August 1.

Story Posted:07/11/2020