Pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Okay. Okay. Uh, so starting off tonight with, uh, public comment related to our public hearing. Um, we've got one name signed up, Ann, for the public hearing for both. Oh, I, I'm saying what I've said for the last few months that I think that the $322 million to spend on, um, here,
Microphone's not recording. Okay, fine. Could you maybe pull the microphone up a little more? Or Like this angle? You hear me now? Maybe more toward, Towards me? Yep, that's good. Okay. Um, I'm just saying what I've been saying for the last few months, that $322 million is excessive for two high school renovations, especially for what you're spending it on. Sports facilities, theater curtains or whatever, and band things, um,
less than 0.00 something, um, percent of kids in high school will make it to the N-F-L-N-F-L, but a hundred percent of them will need to know math skills and English skills and things to get along in the, in the work, the real world, not in the NFL world. Um, the money, I'm, I'm not sure how our taxes are not going up, but I keep being told that they're not going to, but they're not going down either. So maybe if school systems wouldn't waste
our money, maybe the schools wouldn't demand so much from taxpayers, especially when the two referendums are already in place. Maybe the homeowners could get a real, a little relief from this and the kids can get some benefit if they had, um, their academics concentrated on instead of athletics and things like that in order to attract more children to the school. That that is silly. Um, but that's the way it is. So that's what I have to say.
I wish you could justify it better, um, 'cause I haven't heard it. Thank you. Comments. Uh, if you'd like to make public comment, you can, um, up at the microphone. Well, I'm gonna be loud enough from Here. Okay. Just, uh, three minutes Presumption that taxes aren't going up. 'cause all they do is keep saying the property values are higher, so the taxes do keep going up. Yep. They Are double. Ma'am, just real quick, for what, what was your name? Han? I'm sorry. Jean. Ch Thank you. So it's a false assumption that constantly
and he hears some of the biggest wave is superintendent sell. Thank you Jean. Um, the purpose of the public hearing is the notice of the proposed superintendent contract that per Indiana code has been posted for the, uh, requisite time and two periodicals along with our public website. Um, details are there, just reading from a little bit here. The contract will run for three years, uh, commencing, uh, July 1st, 2025 and ending June 30th, 2028.
And unless either party notifies the other by March 31st, 2026, the contract will be automatically extended to June 30th, 2029. Thereafter, the contract shall be automatically extended in additional year unless the superintendent of the board notifies the other party, uh, to the contrary, by May 31st of each calendar year. However, the contract may be extended no more than five years beyond the initial ending date of June 30th, 2028. So again, that was the, uh, public comment and, uh, public hearing for the proposed contract. We will then adjourn that public hearing
and call to order the work session, um, opening up for additional comment specific to the work session, um, energy, and I know you've both made comment, but you're welcome to It's f****d. Said you can hear me. Um, there is absolutely no justification as a, uh, for $15,000 a year. Absolutely no justification. There's no Justification for a salary of over $200,000. And the guarantee of his employment of the,
the superintendent does nothing to actually increase the educational experience of our students. Absolutely nothing. $15,000 a year guaranteed raise ridiculous and tell us what other perks he gets. How many secretaries, how many vehicles, how many drivers? This is absolutely a ridiculous expense when this money could go better to the students. And so I totally protest, uh, $15,000 is more than half of some people's
social security benefit. And that's, and they're trying to pay taxes. They're trying to stay in a house not under a bridge. It's absolutely ridiculous. No, superintendent deserves what you're suggesting. Thank you again, Jean. You may. Yeah, Well, I, I agree with what Jean said. Um, the salary is really quite generous and above that, like the, uh, yearly raise, the, um, amount put into the 401k or whatever, um, 4 0 1 you've got going for you is,
is, is a lot. Um, and you know, that just that equals to what we are paying for the referendums, um, that are in place. Not only that, the, um, stipend or whatever you wanna call it for the car for technology, um, you know, within three years your money for the car equals ano a new car for somebody else. And that's just your bonuses. So I, I do agree with Jean that it is excessive,
you know, especially when you keep leaching from from the community. You know, maybe you guys have gotta give a little bit, little bit more. Um, I agree with Eugene. Thank you Ann. And just to, again, to reiterate the, uh, details of the contract were posted, uh, for the required amount of time in two periodicals along with our, um, public website. Uh, we'll go to items requiring action tonight. Uh, one item consideration of the 2025 to 28 superintendent contract. Move to approve. Second Motion was made by Mr.
Mertz and seconded by Mr. Lewis. Are there questions or comments? Okay, hearing none will go ahead and vote. All is in favor, say aye. Aye. Aye. Aye is nay. My 0.01 is accepted. Uh, the main focus tonight is our property tax update with Mr. Hatcher. Thank you very much. Today we have, um, Jason O'Neill here from Policy Analytics to present, um, on the effects of Senate enrolled Act one on the school district and our tax base. And, um, so Jason's gonna go through, um, a,
uh, detailed presentation here. So, um, I'll turn it over to Jason. Thank you Kent. Uh, my name is Jason O'Neill. I'm the managing director of Policy Analytics. We're in Indianapolis based firm and we specialize in fiscal policy and economic analysis. And so, um, what we've done here is a detailed look at the school's tax base, uh, develop property tax revenue projection, and especially are going to discuss the impact of the most recent, um, changes in property tax legislation
that were embodied in senate enrolled Act one. So lemme just go through a couple of the details and also let me get a clock so I stay on time. Um, so policy analytics has developed a parcel level simulation model that we use in order to simulate and estimate the impact of policy changes on property tax revenues for units of government. So we've got a database that contains parcel level detail.
It goes back a number of, uh, years. And what we're doing here is we're actually simulating a tax bill, uh, tax billing process for the entire county as we're estimating your property tax liability going forward. And so that's what we've developed here. We've updated this with recent assessed value information certified net assessed value information was recently certified, uh, just in the middle of August. And we're gonna go through a couple of revenue scenarios here and also illustrate, um, impacts of SEA, uh, one. So I've been working at Policy Analytics
for a long time now, and I remember back in 2008, um, we were doing some work around on the property tax arena. And hearing Governor Mitch Daniels at that time announced his new plan for circuit breaker caps, uh, change in property tax policy and thinking about how much that was going to change, how we think about property taxes received by tax units and also paid by taxpayers. And this recent legislative change, um, that occurred in this session is probably the biggest shift
in property tax policy since that time. And so I wanted to take some time here and really walk through that and make sure we understand what's going on, what's gonna happen to, uh, the tax base, uh, tax revenues and taxpayer experience over that time. So I'm gonna work through this material. I'm happy to take questions, um, during the, during the presentation from the board, or if you have, uh, questions at the end, we can, um, uh, respond to them then as well. The first thing I wanna do is set a little bit of a profile of what, uh, Perry Township school's tax base looks like.
And some of the text is a little bit small here from a distance, but I'll try to go over the, the, uh, main parts. The map here is showing the taxing districts that comprise the school's tax base. Um, you have several taxing districts each with a different property tax rate that is determined by the actual units that overlap that, um, that jurisdiction or that area. So predominantly, um, you've got the Perry Township area that's part of the consolidated city of Indianapolis, and you can see there's other colored segments in there.
Um, for example, there is a segment of your taxing district, a small segment that overlaps the city of Beach Grove, that there is, um, segment that's within what's called the included town of Southport, um, or sorry, excluded town of of Southport, the included town of Holcroft. And each of these have a different combination of tax rates that comprise the overall tax, uh, district tax rate that a tax payer pays. And the reason that that is important is that, uh, the tax rate that is paid determines a lot about what happens
with property tax revenue. This is a composition, it shows that you know about 91% of your tax base exists in that, uh, Perry Township area that's outside any of the municipal boundaries. You have about 35,000 total parcels that includes all classes of parcels within, uh, within your taxing jurisdiction. And about 73% of those parcels are at the cap. When we say at the cap, we're referring to a circuit breaker cap that was, um, introduced back in 2008, what I just referenced to
and was actually embodied in the Indiana Constitution. That limits, uh, property tax rates to 1% for homesteads owner-occupied homesteads, 2% for non-homestead residential, and 3% for commercial properties. And that's outside any, um, levies that would be approved by referendum. And so what this is showing is that 73% of your taxpayers are at that cap, meaning that they're at, they're paying if their homeowners, 1% of their assessed value in property taxes, um, already.
And that helps to understand taxpayer impacts and also revenue impacts as you move forward. If you increase your levy, your non referendum levy, those, um, taxpayers that are already at the cap are protected by the circuit breaker cap and will not pay any more, um, with, uh, with a given assessed value. There's also got here a, uh, median homestead assessed value that's updated for 2026 at $247,000 to give a sense of where, uh, taxpayers within the district lie.
When we look at the composition of tax base, this is important to understand where your property tax revenues are coming from. About 73% of the gross success value or market value of your property is residential. That's really mostly single family residential. Another 10% is con, uh, is apartments, and then you have a mix of commercial and industrial and personal property, which is about, uh, 5% of the gross assessed value. Now, personal property is a little bit of a misnomer.
It's shorthand for business personal property. And what that is, is it's plant and equipment primarily within industrial facilities. So you think, uh, manufacturing equipment, um, distribution equipment, that's what's described there. And that's about 5% of your overall assessed value. When you look, as you go to the right of this chart and you look at a total net av, you see that those proportions change a little bit. That's because the state offers, um, in, uh, offers, um, enhancements or deductions to certain types of taxpayers,
predominantly residential homeowners. Um, there's a ho homestead deduction that, uh, moves the, um, composition of, of assessed value around slightly. So when we look at what's actually taxed, what's on the right hand side is more, um, more in line with what is actually taxed When we're doing this around the state, oftentimes we talk about tax increment financing and the impact of tiff on, uh, schools tax base. You have very little, um, tax increment increment financing activity within, uh, the corporation here.
I believe, um, the town of Southport might have a TIF that, uh, captures a little bit of increment assessed value, but there's not very much TIF activity here within the school district. Uh, let's go the right way. So this information is pretty hot off the press. I mentioned that we recently just got info, uh, data on the 25 pay 26 assessed value for the school corporation. The auditor, uh, county auditor just certified this information a couple weeks ago. And what it shows is that there's about a 5.5% increase in your assessed value,
your tax base for this tax year. This is showing a little bit of the dynamics which are going on there. When you look at gross assessed value, which is the market value measure of economic activity, we're seeing about a 9% increase in gross assessed value in the tax base year over year, about six and a half percent increase in residential. But we're seeing a large increase in the tax base in apartments and, um, non-residential, largely commercial and industrial, mostly industrial for you all. One thing that we've seen throughout the state this year is
that the, uh, state, the department of local government finance has issued new, um, uh, assessment cost tables this year, and that's had a pretty significant IM impact on non-residential assessed value. So bottom line here is that you're seeing some substantial assessed value growth that's really Boyd by this increase in apartments in industrial assessed value. The thing to take away there though is that this is due to an assessment change. It is a one year increase. That doesn't mean it'll come back down the next year,
but this is not the type of increase, especially in the non-residential sector that we would expect on a year over year basis. And we'll talk a little bit more about that as we get into the forecast. Quick question for you. Yes. And your growth numbers there, uh, would you call those growth numbers Gross assessed value? That's a year to year increase in gross assessed value. Yeah. Is that a combination of new home assessed values along with new construction? Correct. It is. Alright. Yeah. Quick question here. Uh, yep.
You have here in the, uh, change by property plus and that's annual residential test increase the six, 6.5, right? Uh, the assess value? Yes. Yeah, that's And do you have that statewide database? Comparative database? We do not have statewide comparative data yet because we don't have, uh, certified assessed values for all counties yet. Okay. What we've seen come in is a little bit across the board. This is not unusual or out of line with what we're seeing, but I don't have a specific like percentile
of the state's average yet. Um, within a couple weeks we should have that and we can provide that, uh, to the school. Yeah. Thank you. Any other questions to that? Right now I'm gonna get into how we are forecasting your tax base going forward, and that's gonna lead us into some conversations about implications and impacts of, of property tax change. So in order to give you a revenue forecast, the first thing that we need to do is provide a forecast of the tax base or the assessed value that the revenue is based on. So this is just a little dashboard of some
of the market indicators that we use, which, um, has some interesting, um, aspects to it. First on the top left hand corner there, that's a time series of residential sales price, median sales price for, for Marion County, this is market data. This data is actually from Redfin, which is the aggregator of, um, real estate trans transaction data. But what you can see on, um, I don't know if I can actually, yeah, you can't see that. What you can see on the, um, tables on the, uh, right there are, we've seen some significant historical,
like recent increases in, in market value between 21 and 22, we saw 13.5% increase in market value. That has started to level off. We've seen that now for a couple of years. And for 20, between 23 and 24, which is really the assessment, um, or the market transactions that were embodied into the, what I just talked about, we saw a 4.7% increase in, uh, sale median sales price. And so far, year to date in 25, we've seen a 2.8%, uh,
increase in residential median sales price. So that gives us some caution about how fast we are assuming the tax base is gonna grow going forward. Um, it's important to note that in Indiana taxes are property taxes are paid in arrears. So we're moving into what is, um, classified or the, the, the terminology is the 25 pay 26 tax year. So what that means is property is assessed as of January 1st, 2025 for taxes
that are payable in 26. So when you pay your tax bills for in 26 in the spring and in the winter, that's gonna be based on your 1 1 20 25 assessment. That assessment is largely based on market data that occurred during calendar year 2024. So there's a little bit of a lag between by the time that market we get market information, like actual market information and that makes its way into the assessment process and starts to affect your tax revenues. Go ahead. Good question. Uh, the, the property tax increase reflective,
the market value increase, right? Correct. I own, I bought a home in 2016 and paid townships school estate and I pay more than double or triple tax proper tax every year. Although I don't sell, I don't get money. Yes, but still taxes increasing, that's really one thing to make sure that the resident understand that, uh, is automatic kind of reflective market value increase that also collaboration in correlation with the property tax increases reflective the market value increase as well? Yeah, so Indiana as a market value state
and assessments are supposed to be reflective of market value, right? And they are adjusted annually on a year to year basis in a process known as trendy. And so in that process, the county assessor aggregates market data and determines how fast market values are growing on a neighborhood level and applies those rates of change to the assessment, um, to your individual assessment. And then every four years, each property goes through what's called a reassessment process, and that's a more fine-grained process where things like,
you know, if you've added a deck or if you've reroofed the property or if you've pulled a building permit, those changes get incorporated into your assessed value as well. So it's kind of a dual prong approach. Um, and you'll see we'll get to the assessment data and there has been a, a pretty rapid increase, um, in assessed values throughout Marion County and throughout the state over the last few years. So this is some of the data that underpins our forecast. And next chart here is gonna show the forecast of tax base. And this is where we get into some of these, um, changes with it with senate enrolled act one.
So I'm gonna focus on the upper left hand chart first that has got two lines. Uh, we've tried to simplify this, um, to, uh, guide the di discussion. The green line is our forecast of gross assessed value. That's what we were talking about. That's the market value of the property within the taxing district, including residential businesses and personal property as well. You can see the history, uh, you can see that increase, uh, in the rate of change of assessed value that we're just discussing beginning in about 21 to 22
and how that's changed over time. Um, we are projecting, um, about a three and a half. I think it's about a 3.5% average change in gross assessed value going forward, which is pretty reflective of what we think inflationary trends will be. The blue line is the net assessed value for the school corporation. That is the assessed value that your levies are applied against in order to calculate your tax rates. So the net assessed value is after everyone receives their homestead deductions, all
of those things are accounted for. It's the taxable prop, uh, the taxable, sorry, taxable amount of the property. This has a interesting dynamic to it. You see that it also increased over between 2021 and 2025. We've got about a 5% increase in 26, but then we're projecting that actually goes down in the future. And that is a key, um, dynamic of the recently passed Senate enrolled Act one, which in which, um, contained a number
of policy changes and property tax relief provisions within it. One of those changes is a change to the homestead deduction. Currently, if you're a homeowner and you have a single family, um, and sorry, an owner occupied property, it doesn't necessarily have to be single family, an owner occupied property, you get a deduction that's equal to about 35% of your assessed value. So that means you're only paying taxes on, on the remainder. 65% of it Senate enrolled Act one is going to increase that deduction to two thirds over the next few years, um,
culminated in 2031. So by 2031, homeowners will have a two thirds, uh, 67%, um, homestead deduction. One of the, um, uh, after effects or side effects of that is that when you remove assessed value from the tax, uh, or when you add assessed value to the deduction, it removes assessed value from the tax base. And that's one of the reasons you've seen that, um, assessed value trend go down in the future. Similarly, rental properties are going to get a new deduction that's equal to about one third
or equal to one third of the assessed value. And on the charts at the bottom here, you can see how much assessed value is gonna be contained in those deductions over time. So those will have a couple of dynamics. They can provide property tax relief to taxpayers, but they will also reduce, uh, the tax base for taxing units. And as we'll see, we will result in increased tax rates, um, as a result of that. And the di the way that those intersect with revenues and taxpayer impacts is fairly complex. So bottom line, over the last 10 years,
your school's seen about a six point a half, 6.4% average change in assessed value. Um, last year to this year, we're gonna see 5.5%, but we're projecting that that shift, that, uh, trend shifts and we're actually gonna see a reduction in taxable assessed value over time. Um, because of the way those deductions come on, that's gonna present, you know, interesting challenges on how we talk about taxation and communicate things, um, uh, within, um, not only school corporations but cities and towns within, uh, units of government
and to taxpayers as well, because you see that there's now a shift in the past, the green and the blue lines roughly changed at the same rate. Uh, changes in net assess value were, um, you know, roughly aligned with changes in market value going forward. We're gonna see that the tax base does not change at the same rate as the market value of the property. And so there's more, um, more communication and more education to do about what's going on with the tax base. Here's a little detail of, um, the annual projection
for a certified net assessed value. So you can see really those years 27 through 2031, where those deductions phase in over time are the years that we're projecting reductions in the tax base. And then once those phase in over time, the tax base will continue to grow. There is one other tax, uh, property tax relief, um, component of SEA one that I haven't mentioned yet, and that does deal with business personal property. Uh, the most relevant one here is that currently there's what's called a di minimis
business Personal property exemption. That means if I own a business and my, the sum total of purchased equipment for my business is 80,000 or less, it is exempt from personal property. I don't need to pay personal, uh, property taxes on that personal property. If it's, you know, 200,000, um, then I do need to, to pay taxes on it. Next year in 2027 for taxes payable in 2027, that di minimis personal property exemption is going to move up to $2 million. So if you're a business and you have $2 million
or less in purchased equipment, you'll be exempt from personal property. Um, taxation. It is interesting. There's no, um, scaling or gradient. If you've got $2,000,005 of business personal property, you pay property taxes on the whole thing. And so there's um, some, um, interesting dynamics there. So overall, that is how we're, um, projecting as we run the modeling that your tax base is going to change moving forward. Now we're gonna move into the second part of the, um,
of the, not only the tax bill, but of how we're processing all of the property tax, um, components here and talk about credits, deductions and credits sound very similar, but they're actually very different things. So let me explain what's going on here. A deduction is a reduction in taxable value of your property. So if I've got a hundred thousand dollars home and a $50,000 deduction, I only pay taxes on 50 thou on the remaining $50,000 a credit is a reduction in the actual tax bill.
So if I have a $1,000 tax bill and I get a $100 credit, I pay $900 on my tax bill. So they're both, um, measures or, um, initiatives to enact property tax relief, but they have different mechanics and different actions. Um, important for school corporation is that several of the credits that affect taxpayers are unfunded. So if a taxpayer gets a reduction, it's a, um, reduction in revenue for the taxing unit. There's no replacement revenue there. Um, and so this is showing what's going on in,
um, the credits. And there's a couple of things to look at here. The dark blue line, uh, bar is the circuit breaker credit. That's how much of, uh, what you levy for is uncollected due to the circuit breaker credit. That's the 1%, 2% and 3% credits we talked about. Then there's another segment. Um, it's both the light blue and the orange, which is termed unfunded credits. This is predominantly the new, uh, set of new credits that was imposed or that was provided really in SEA one.
Um, there's a couple measures here. One is a new 10% credit for homeowners. So now in addition to the deduction we talked about previously, homeowners will receive a credit on their tax bill that's equal to 10% of the tax liability up to $300. So, you know, if you get a tax bill that's $3,000, you'll get, uh, $300 credit on that and now owe, uh, $2,700. That difference is unfunded. That's, um, not received by the taxing units. Um, but it is direct property tax relief to taxpayers.
And so this shows how we're projecting that moving over time, increasing, um, over time through 2028, um, due to a lot of the mechanisms and shifts that are going on with SEA one and then that starts to come down as well. Understanding this, especially in the short term, is really critical for, um, uh, the school to understand what their, what the revenues are gonna look like for your operations fund, for your debt service fund, and for your operating referendum funds. Because speaking of your operating referendum funds, there are some dynamic impacts here as well.
You currently have an operating referendum rate that's about 40 cents, uh, almost 41 cents. Uh, that's per $100 of assessed value. Important thing about, um, the operating referendum is that it is controlled at a rate level. So if you can keep that operating referendum rate constant while the tax base is going down, you'll see reduced operating referendum revenues. And as you're thinking about overall what your future financial plan looks like, it's an important thing to keep in mind.
One of the, um, side effects of the tax base coming down is that we will see reduced operating referendum revenues in the future given a, um, a consistent tax rate. So all of this gets mixed together and we generate property tax revenue scenarios off of that. Um, I've got a lot of scenarios here, there's a lot of numbers here. Um, I'm not gonna read all of these numbers, but I wanna give you an overview of the scenarios we've run and really some of the major implications here. Really one of the major fa one of the major
variables in property tax forecasting is your debt service rate. How much are you going to do in capital projects in the future and how does that affect your overall property tax profile? This first scenario keeps that debt service levy constant, basically saying that you're gonna ask for the same amount of property taxes to fund debt service in the future. And you can see it's probably easiest to see in the chart to the bottom left here, what this looks like, um, to your overall revenues. The dark blue is your operations fund that primarily funds,
um, transportation and facilities. The orange is your debt service, your non-exempt debt service that is not part of your referendum. The, uh, light blue is your operating referendum and then the gold is your capital referendum. And then that gray at the very top is your unfunded credits. So that's a part of your property tax. Uh, the property taxes that you levy that you asked for that are unpaid because taxpayers receive credits. Major thing to note from here is that due to all of these mechanics, we're not projecting a lot of growth
in operation, operating ref revenue in the near term, 25 through 28. There is some growth in the operations fund and a reduction in the operating referendum fund. So there's not a lot of growth coming, um, forward here in how your, you make capital decisions will affect that even more going forward. Um, a lot of this depends on how fast the tax base grows. We're projecting a little bit more growth between 28 and 2031. Um, especially in the operations fund though we're still
projecting constricting revenues in the operating referendum fund given the same rate. Uh, we've also run a scenario that assumes essentially inflationary, uh, growth in your debt service levy. Um, this essentially take means they're taking on capital projects at a rate, um, that approximates inflation. Um, this provides a little bit more total revenue into the corporation, but it comes at the expense of some revenue into the operations fund. And so that's a dynamic to continue to manage. Dr.
Spray in the middle There, charter share. Explain that for me. Yes, that is something I definitely want to explain. Let me go back, uh, just so we don't have too many things moving around to the first scenario. So, um, there are two components of charter charter sharing that are now part of Indiana law. Um, these, um, both I believe were embodied in SEA one. Um, and what this means is that, um, students who attend charter schools will receive funding for, um, operational and operating referendum, um, from
operations fund and operating referendum sources, uh, that will essentially follow them to the charter schools that they attend really no matter where they, where they are. So if you've got students within, um, the corporation here that attend charter schools, um, they will have revenue that follows them to those charter schools. And there's two components of that. One is the operating referendum. This will not take place until or unless or until you pass a new operating referendum a in the 23rd, I think after 2030 anyway.
But what this is, is a full, um, proportional share. So any operational revenue operating referendum revenue you, you receive will be shared to charter schools on a proportional basis. So roughly if that means that 2% of your students attend charter schools, basically anywhere in the county or really the state, um, 2% of your operating referendum revenue will go to charter schools. It's a little bit more complicated with operations fund. There's a pretty complex formula that's in place between now
and 2028, but beginning in 2028, there's a scale up proportional process as well. It's gonna take a couple of years to scale up, but by 2032 there will be proportional sharing in the operations fund as well. Similarly, I lost, there we go. Similarly, if 2% of your students are attend charter schools by 2032, 2% of your operations fund revenue will be allocated shared to charter schools and that will be a, um, automatic process.
It, the dollars don't even come through the school corporation. The county auditor will just distribute those revenues to the charter schools and, you know, depending on what your makeup looks like, if that's, you know, 15% of students, that's 15% of the revenue. And so it's just a proportional share going forward. And so we're projecting that by 2031. That's about $600,000, uh, for a school corporation here. Jason, I do have a question. Yes. Um, of course I'm thinking old mentality when you did a referendum, uh, referendums do have somewhat of a little bit
of a cost to them, um, when any school district does them. Does, is there anything in Senate bill one that the, um, charter schools would share in that as, as a proportion or percentage basis of the expense? Or do they just get the, if the referendum passes, they get their percentage of that Referendum? Yeah, I don't want to get too far into the actual, I'm not an attorney the legal mechanisms, but yes, there's an intention that to participate in the charters in the revenue that you would need to, um, sign on from the beginning
and participate in the cost of the referendum. Nice. Okay. Thank you. Go ahead Dr. Spray. First time in regards to the local property tax. We don't have any charter schools in Perry County. Um, we would be sending local property taxes outside of Perry Township. Would that be the first instance of local property taxes leaving the local county? I have to think through all of the ramifications of that, but it is the, yeah, it is the first time that we have formulaic property taxes that are, that will end up or will be destined to a place outside of the unit
that levies them for sure. Um, there could be some, you know, interlocals or some, um, type of agreements like that, but this is the first time we've got a distribution mechanism that will send property tax or dollars that are levied by one institution into another institution. Good Question. Go ahead. So in the scenario, there are two categories that will cause the, the income by 2030, let's say. Like one thing operates operating different and front because tax will decrease, right?
Mm-hmm. And second thing is the charters share school share that will take away from this school year, correct? Two category will cause the, the income re The revenue reduction, right? Yeah. There's one other that you'll see in the, um, early years and that's just the increase in these un in the unfunded credits. Um, property tax relief that's, um, distributed taxpayers. Another a quick question. The previous, uh, things green that mentioned about seniors tax credit, like Hope State up 65 plus. Yes. Is there any significant change?
So there are some changes there. Um, seniors, um, seniors will get at. So there's a couple of, um, property tax relief provisions available to seniors. One was in current law and it's a, um, credit that limits your tax, the increase in tax liability to 2%. So it's got some, um, eligibility criteria. Your assessed value has to be a certain level, your income has to be a certain level. Um, but if you meet that criteria and you file for this, then your tax bill will not increase more than 2% year over
year regardless of what either your assessed value does or your the tax jurisdictions do. So that's already in current law. Then SE one provided a couple of additional, um, property tax relief incentives. One is for seniors and that's a additional $150 credit. And there is also a, um, blind and disabled, um, credit that's $150 if you meet, um, eligibility criteria in total. The revenue impact of that is not significant, but it can be significant for those who qualify for the,
for the incentives. Any other questions before we move on here? Alright, I'm going to describe these and then we're gonna compare the, the revenues here. Um, next scenario we u looked at is a, um, 2% levy growth. Uh, the debt le levy growth. This assumes that your debt levy increases by essentially a measure of inflation. Um, one thing to note here is, um, if you look, you can see it at 2031, the bottom right hand, or sorry, bottom left hand chart on the, our first scenario,
you're bringing in about $30.4 million in, um, operations fund dollars by 2031. Um, on that 2% levy growth, it just reduces it a little bit. So we're talking about trading off debt service for operations fund levy. And then the last scenario we ran, um, sorry if I go the right way, is what we call a stepped debt levy that essentially holds your debt service rate constant for 2026 and then keeps it at that constant levy level going forward. So a lot of details there. So I want to go into, um, essentially the comparisons here.
Basically there's some, um, trade-offs in operations fund net revenue and total net revenue depending on what strategy you do here. A lot of this strategy is gonna be based on what capital projects you need to do and what kind of trade offs you have in your operations fund. We're also seeing rates increase over time, and this is because the tax base goes down as well. This is gonna be another thing that's, uh, complicated to explain, and it's gonna take effort to explain not only to, uh, within taxing units, but also to tax payers as well. Even though these rates are going up, that doesn't mean
that, um, tax liabilities are going up or even going up at the same level because most of your tax payers by the, at this point will be protected by the circuit breaker cap. So they're gonna pay 1% of their assessed value really no matter what tax rate, uh, you have, if you're a homeowner, 3% of your, of your assessed value, if you're a commercial, your um, tax rates are below $3, which is notable. It provides a a little bit of variability in the revenue estimates. One thing we are seeing here is a shift
of tax liability from residential to the commercial sector as well. Um, that's some of the properties, the dynamics of how property tax relief is enacted in SEA one is that there's some property tax relief for homeowners, but at the same time some shift in tax liability to commercial taxpayers. Why is $3 significant? So $3 is significant because homeowners are capped at 1% or $1 per $100 of assessed value. Re rental part properties are capped at 2%
or $2 per a hundred dollars of assessed value. And commercial properties are capped at $3, uh, 3%. So if the total district rate goes above $3, that means essentially all of your taxpayers will be at the property tax caps at that point. Okay, so that generally summarizes the information I have. Here's our team who's doing the work. We've got some background data in the appendix. Um, I'm happy to take questions. I know we've got into a little bit of the, uh, 4 0 1 level on the property taxes.
Um, there's a lot of detail here. We will be monitoring this. There's a couple of different points during the year where we'll make an update to provide, uh, to, um, Kent and, and the school, uh, to make sure that everything is up to date and going forward. But happy to take any other questions that you have. I'm happy to take questions through the board. I'm however you wanna handle it. So In all your scenarios here, you're just showing the, the tax rates fluctuating, it's gonna go up, it's gonna go down, property values are gonna still go up, essentially. Yeah. So with that, your
property tax is gonna go up initially and then it's gonna come down a little bit. Yeah, we don't have a actual taxpayer impact slide in this, that experience will depend a lot on where you like what the market dynamics are in your area. In a lot of the places, and I think we ran some numbers on this for um, a while ago, we're seeing a modest to, well, I don't know exactly how to characterize it, but a reduction in tax liability for most homeowners. For pay 26, they're gonna get a 10% credit on their tax bill
that they didn't have before. So as long as your assessed value, um, doesn't really increase greater than 10%, you'll see a reduction in assessed value, or sorry, a reduction in, uh, your tax bill holding most other things equal. There's a whole lot of variables there, but we're seeing a reduction in homeowner tax bills for 26. We're seeing essentially constant. Some places have increases, some places have decreases, uh, tax bills for homeowners through 2031 as these, uh, as this homestead deduction comes on.
And then after that, uh, you could expect property tax liabilities to increase proportionately with your assessed value. I need to get a see a question here. Um, I'll defer to the board president. Right. Um, I, I was just even speaking for the board, um, with this amount of information, inevitably we're gonna have questions that shake loose. So if you're willing to leave that contact and reach out or even hang out for a second, um, and, and maybe answer anything that pops up in the next couple minutes, we would appreciate that. I'm Happy to do that. Perfect. And thank you so much to you and your team for all the work.
Sure. Um, and, and making us aware of, of the future here. So thank you very much. Okay. Quick question here. Yeah. Uh, I don't know if you have done in other logistics the what could be the best way to educate the public to let them know the properties? Property tech mayors for us is really clear. Uh, it helps me understand a lot more than before if done. Yeah. Or what usually be tax school do to educate, inform the resident. It's not only that cost tax increases not only
for the school referendum fund, but also the market value increase and other meta. Yeah. What would it be the best way to, to advise? You know, over time a lot of schools have relied on their tax rate to explain something about taxation to taxpayers. Um, that's not gonna work anymore because tax rates are gonna go up independent of what schools or any other unit does in their, um, uh, really in their level of spending. So being really clear about what your year to year change in spending overall means,
especially in your property tax levies. Um, what that consists of and what that means. And also being really clear about what the assessment and market data is showing. Like, some of this information of, hey, across the board we saw a 6.5% in residential assessed value is important because that does impact taxpayers. Right? You know, you mentioned it, everybody sees that their tax bill goes up that's really independent. Um, it could go up even if the school doesn't make any other spending, um, changes. And so being able to talk about
what the school is doing versus what the market's doing is impor is going to be really important in communicating that in a clear way. Okay. And I think what you've been able to share tonight has, um, helped us be a little more informed on, on that reality of where we're at moving forward and obviously leaning on the expertise of Mr. Hatcher moving forward as well. Sure. Any other board questions or comments? Uh, couple final things to wrap up tonight. Our next, uh, regular meeting is September 8th, uh,
6:00 PM here in this room. And with, uh, fall breaks on the horizon in October, that does affect our, our meeting after. So, uh, September 8th, 2025, 6:00 PM here. And then September 29th, same time, same place. With that, we a adjourn this evening.