Citing the devastating impact of a new property tax bill, Hobart Superintendent Peggy Buffington said Thursday it could push more than 100 school districts to seek property tax referendums next November.
School districts, like Hobart, are finalizing their 2026 budgets now and have until Nov. 15 to file them with the state.
The Hobart School Board ratified its contract with the Hobart Teachers Association on Thursday, providing meager raises of about $1,000 for teachers.
“I think we’ve always given as much as we can,” said Buffington. “If the goalposts wouldn’t keep changing, we could give more.”
In May, Hobart voters approved the renewal of an eight-year $22.4 million property tax referendum. The vote came just weeks after Republican Gov. Mike Braun signed Senate Enrolled Act 1, his top legislative priority he promised would provide relief to taxpayers.
A state agency estimated the new law will erase about $744.2 million from Indiana public school budgets. The law gives property owners larger deductions, while municipalities and schools will receive less. The average savings for homeowners is about $300.
In some districts, it could place bus transportation and other expenses at risk.
“Is this what you want to do to municipalities and public school systems?” asked Buffington.
She projected Hobart could lose about $6.1 million of its referendum fund money over its eight-year life span.
Some districts, including Lake Central and Duneland, raised the rate on property tax referendums voters approved Tuesday in the wake of the new law.
Meanwhile, Buffington said the district already loses 81% of its levy to tax caps approved in 2010 to rein in rising tax bills.
Of the funds making up a district’s budget, local property taxes only support the operations fund, which finances transportation, building repairs, cleaning supplies, and building maintenance. It also covers salaries for custodians, maintenance and clerical workers and some instructional and administrative staff.
If the operations fund runs low, the state allows districts to transfer up to 15% from the education fund that finances instruction.
“We were barely squeezing just paying our NIPSCO bill,” said Buffington.
“We have to transfer 15% out of our education fund to bail out the operating budget, because of these types of laws. We could be getting more teachers if we didn’t have to do that.”
Board member Bradley Keehn said costs were climbing everywhere “but teachers have a special job, I wish we could pay them more If we didn’t have to transfer money out of the education fund to support operations… We need help from downstate to fix these problems and not create more.”
Board member Sandra Hillan agreed.
“I feel like SEA 1 is tearing us apart. I’m thankful we were able to come to an agreement.”
The school board unanimously ratified the contract, already approved by teachers, providing a first-year teacher salary of no less than $50,000. The top of the scale for the district’s most experienced teachers is $85,245.
Another new state law calls for teachers to receive pay increases based on a point-scale rating evaluation based on experience, academic needs for college and career readiness instruction, and for earning the early literacy endorsement.
The maximum base increase a teacher could earn is $1,169, according to the agreement.
The contract runs through June 30, 2026.
The board also approved a contract, retroactive to July 1, with SEIU Local 73 for custodians and maintenance workers.
They’ll get a 2.5% wage increase with the top-paid custodian earning $19.72 an hour and the top-paid maintenance specialist receiving $26.65 an hour.
“The people who work there are totally amazing,” said Buffington. She said some workers said they wouldn’t take the increase.
Support staff workers, including nurses and classified staff, also received 2.5% increases.
Compensation for administrators aligned with teacher wage increases.
The board also voted to increase daily pay for substitute teachers to $105 for licensed teachers. The daily rate is $95 for substitutes with a bachelor’s degree or higher; $85 for a high school diploma; and $12.50 daily for substitute clerical positions.
Carole Carlson is a freelance reporter for the Post-Tribune.
Hobart school chief forecasts grim finance picture
