Property tax caps might be giving homeowners relief, but they are forcing some school districts to fall out of compliance with state bus replacement rules and to contemplate scrapping student transportation altogether.
Officials from Fort Wayne Community Schools, which operates about 350 buses traveling a total of 3.6 million miles a year, said they are feeling the pain as taxpayers within the city quickly hit the caps, and funding is sliced for public school budgets.
As revenue continues to decline, the district must maintain transportation services and keep up with replacing dozens of buses each year.
Other local districts say no school corporation is unscathed by the tax-cap laws, and at least one – Northwest Allen County Schools – has publicly discussed what parents and students might face if things don’t improve – the loss of transportation entirely.
Indiana property tax caps were amended into the Indiana Constitution after being approved by Hoosier voters in November 2010.
The caps limit property tax bills to 1 percent of the assessed value of homes, 2 percent for farms and rental properties and 3 percent for businesses – saving homeowners money on taxes but creating challenges for taxing bodies, including school districts that depend on the revenue.
Rural school districts are more likely to have taxpayers who have not yet reached the tax cap, meaning the full amount charged by the district and other taxing bodies is paid by the taxpayer.