School bond and tax elections in Indiana

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School bond and tax elections in Indiana happen under three circumstances
  • To exceed the property tax revenue limit.
  • To Issue new bonding.
  • To exceed its levy if a school district has to issue refunds under the Excessive Property Tax Credit law.

Laws affecting school finance

Indiana bond issue law

In Indiana, school districts are defined as political subdivisions. All political subdivisions are mandated to seek voter approval to issue new bonds for new school buildings. Indiana is one of a few states that sets maximum limits for school districts for issuing new bonds, this prevents school districts from seeking high dollar referendums which can be common in other states. In Indiana, bonds are restricted as follows:

Bond issues must fit in one of three categories:

  • Category A-An elementary school building, middle school building, or other school building for academic instruction:
  • That can be used for any combination of kindergarten through grade 8;
  • Cannot be used for projects involving grades 9 through 12 and
  • That school districts cannot ask the taxpayers to approve more than $10 million in bonding.
  • Category B-A high school building or other school building for academic instruction that:
  • That can be used for any combination grades 9 through 12;
  • Cannot be used for projects involving kindergarten through grade 8; and
  • That school districts cannot ask the taxpayers to approve more than $20 million in bonding.
  • Category C-Any other controlled project that:
  • That is not a controlled project described in Categories A and B
  • That school districts cannot ask the taxpayers to approve more than $12,000,000 or an amount equal to one percent (1%) of the total gross assessed value of property within the political subdivision on the last assessment date if that amount is at least $1,000,000.[1]

Under the "controlled project" clause under Indiana Bond Issue Law, school districts can issue new bonds for new construction and capital improvements as long as the bonds are not used for:

  • Debt Service
  • Lease Payments
  • Refinancing of existing projects funded by bonds.
  • If the project is ordered by a state or federal court to be in compliance with a judge's order.
  • In response to a natural disaster or an emergency.[2]

A referendum seeking bonds in excess of the limits is rare because it is either for an a emergency purpose, involves debt service, or is in compliance with a federal or state judge's order.

Indiana excessive property tax credit

Indiana is a state that requires school districts to issue refunds via an excessive property tax credit if they exceed a set threshold for taxing different classes of property. Under the law, school districts must issue refunds if the property taxes paid by the first of the new year exceeds these thresholds:

  • If a homestead exceeds one and five-tenths percent (1.5%)
  • If residential property exceeds two and five-tenths percent (2.5%)
  • If long term care property exceeds two and five-tenths percent (2.5%)
  • If agricultural land exceeds two and five-tenths percent (2.5%)
  • If nonresidential real property exceeds three and five-tenths percent (3.5%)
  • If personal property exceeds three and five-tenths percent (3.5%).[3]

The law does not apply to new property taxes approved by referendum.[3]

Indiana referendum tax levy

Under Indiana Law, a school district must put a referendum tax levy ballot question if the district determines that it cannot carry out its public educational duty without asking the voters to vote for more property taxes. A school district must also issue a referendum to replace property tax revenue that the school district will not receive under a mandatory application of the Indiana Excessive Property Tax Credit.[4]

Indiana property tax cap

In Indiana, school districts are considered to be political subdivisions under the law for taxing purposes. School districts are capped on the amount of property tax revenue they can take in. There are two established property tax cap rates in the State of Indiana; there is a cap of forty-one and sixty-seven hundredths cents ($0.4167) on each one hundred dollars ($100) of assessed valued property in areas outside the corporate limits of a city or town which is mostly for rural and unincorporated areas. The other cap is sixty-six and sixty-seven hundredths cents ($0.6667) on each one hundred dollars ($100) of assessed valued property inside the corporate limits of a city or town.[5]

If a school district wants to fix or exceed a property tax cap, voter approval is needed.[6]

Conduct of the bond election, limitations, rules

Authority conducting elections

The respective county elections boards is responsible for conducting elections.[7]

Election dates

School districts can hold elections during the primary or general elections scheduled on the Indiana election calendar which are the first Tuesday in May and the first Tuesday in November every year.

Needed majority

Only a simple majority is required to approve a ballot question for bond issues, property tax cap, or the referendum levy. [8] [9]

Special and Emergency elections

School districts are allowed to hold special elections, 90 days must elapse when a special election is certified by the school board before a special election date. If the election involves a previously defeated ballot measure, one year must lapse before a school district can pursue a special election.[10] [11] School districts must pay all costs for special elections.[12]

If an emergency exists, the school district must immediately apply to the department of local government finance for a determination that an emergency exists. If the department of local government finance determines that an emergency exists, the governing body may adopt a resolution to move forward with a plan that involves an emergency election. Emergency elections must follow the same 90 day elapse requirement between approval of a resolution and the date of the election.[13]

Wording of measures

In Indiana, there are strict laws on the format of a ballot question which is outlined in the Indiana Statutes:

Bond Issue

"Shall ________ (insert the name of the political subdivision) issue bonds or enter into a lease to finance ___________ (insert a brief description of the controlled project), which is estimated to cost not more than _______ (insert the total cost of the project) and is estimated to increase the property tax rate for debt service by ___________ (insert increase in tax rate as determined by the department of local government finance)?".

Property Tax Cap and Referendum Levy

"For the _____(insert number calendar year or years) year or years immediately following the holding of the referendum, shall the school corporation impose a property tax rate that does not exceed _____________ (insert amount) cents ($0.__) (insert amount) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation's normal tuition support tax rate?".

Required notice of bond election

Bond elections

Under Indiana law, a petition process is one option to get a school bond election to occur. The first step is to issue a public notice before January 1 of the new calendar year asking the voters for a petition for a measure to be placed on the ballot. The voters of the district then have thirty days after the publishing of the notice to gather enough signatures to petition for a ballot measure. The standard is either one hundred (100) persons who are either owners of real property within the school district or registered voters residing within the political subdivision; or five percent (5%) of the registered voters residing within the school district. The person who circulates the petition must sign the petition.[16]

After the petition is given to the County elections board, the county must forward the petition to the County Auditor no more than fifteen (15) days after receiving the petition. Once the County Auditor receives the petitions from the county elections board, they have no more than ten (10) days to certify the signatures and notify the circulators if their petition is valid and has enough signatures to be placed for the next election allowed by law. The final certification standard is 125 signatures. If the petition is certified, then the petition is sent to the school board within 35 days of certification to finalize the certification process.[16]

All ballot questions for bonds must be approved by the County Auditor sixty days before a primary election if the ballot question is to be placed on the primary or municipal primary election ballot. August 1 is the deadline to certify the ballot question if it is placed on the general or municipal election ballot.[17]

If a school district wants to approve a bond election via a resolution, 49 days must elapse at minimum when a district approves a resolution to the date of the election.

Levy and property tax cap

For referendum levy and property tax cap elections, six months must elapse between certification of a resolution by a school board and the election to occur during the election(C 20-46-1-14).

Special elections

90 days must elapse before a special election can occur involving a property tax cap or levy election.[18]

List of 2010 Indiana school bond referendums

2010 statewide primary

Date District Bond Amount/Tax Cap Increase Passed/Failed  % Pass
May 4th Carmel-Clay For the seven calendar years immediately following the holding of the referendum, shall the school corporation impose a property tax rate that does not exceed sixteen cents ($0.16) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation's normal tuition support tax rate? Passed 58% to 42%
May 4th Clarksville For the seven calendar years immediately following the holding of the referendum, shall the school corporation impose a property tax rate that does not exceed twenty-four cents ($.24) for each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation's normal tuition support tax rate? Failed 55% to 45%
May 4th Decatur County-Question 1 Approve a bond issue over 20 years in the amount of $36,140,000 for renovations and improvements to North Decatur Elementary School, South Decatur Elementary School, North Decatur Jr. / Sr. High School and South Decatur Jr./Sr. High School Failed 57% to 43%
May 4th Decatur County-Question 2 Approve a bond issue over 21 years in the amount of $14,360,000 for adding a physical education and fine arts addition to North Decatur Jr./Sr. High School and South Decatur Jr./Sr. High School. Failed 63% to 37%
May 4th Eastern Hancock For the next seven calendar years immediately following the holding of the referendum pursuant to Indiana Code 20-46-1-8(a)(10, Shall the Community School Corporation of Eastern Hancock impose a property tax rate that does not exceed 16.57 cents ($0.1657) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate? (For voters in Brown, Blue River and Jackson Townships) Failed 68% to 32%
May 4th Mount Vernon For the seven calendar years immediately following the holding of the referendum, shall the school corporation impose a property tax rate that does not exceed 25.10 cents ($0.2510) on each one hundred dollars ($100) of assessed evaluation that is in addition to the school corporation's normal tuition support tax rate? Failed 66% to 34%
May 4th Noblesville-Question 1 For the seven calendar years immediately following the holding of the referendum, shall the school corporation impose a property tax rate that does not exceed 21.15 cents ($0.2115) on each hundred dollars ($100) of assessed valuation and that is in addition to the school corporation's normal tuition support tax rate? Passed 63% to 37%
May 4th Noblesville-Question 2 Shall Noblesville Schools enter into a lease to finance the Keeping Our Schools Strong Project which includes a new elementary school; the renovation and construction of additions to the current Noblesville Intermediate School, including site improvements; the renovation of the current Noblesville Middle School, the renovation of Hinkle Creek Elementary and the former Tri-County Opportunity School, and the renovation of and construction of additions to Noblesville High School, North Elementary School, Hazel Dell Elementary School, White River Elementary School, and Stony Creek Elementary School (the "Project"), which Project is estimated to cost not more than $63,600,000 and is estimated to increase the property tax rate for debt service by a maximum of $.19? Passed 60% to 40%
May 4th Northern Wells “Shall the Northern Wells Community Schools issue bonds or enter into a lease to finance the renovations and improvements to the Norwell High School building (the “Project”), which Project is estimated to cost not more than $15,845,000 and is estimated to increase the property tax rate for debt service by a maximum of $0.2201." Defeated 55% to 45%
May 4th Pike Township Shall the Metropolitan School District of Pike Township, Marion County, Indiana, issue bonds or enter into a lease to finance the Tax Neutral New Guion Creek Elementary School Project in order to create equity among our elementary students in the 21st Century by providing our teachers with the tools needed to offer a quality education to all of the children in our community, which is estimated to cost not more than $21,475,000 and is estimated to increase the property tax rate for debt service by $0.2375 per $100 of assessed value based on the assumption that the debt service fund tax rate would otherwise be $0.00? Passed 69% to 31%
May 4th Renneselar Central Shall the Renneselar Central School Corporation enter into a lease to finance the renovations and improvements including the security/safety concerns at Van Renneselar Elementary, Rennselaer Middle School, and Rennselaer Central High School and the construction of a new primary school bulding {the "project"), which project is estimated to cost not more than $14,835,000 and to increase the property tax service rate to $0.2278? Passed 53% to 47%
May 4th Rossville Shall Rossville consolidated School District enter into a lease to finance the renovation of and new construction at Rossville Elementary/Middle/High Schools (the “Project”), which Project is estimated to cost not more than $13,455,000 and is estimated to increase the property tax rate for debt service by a minimum of $0.59? Failed 67% to 33%
May 4th Town of Speedway For the next seven calendar years immediately following the holding of the referendum, shall the School Town of Speedway impose a property tax rate that does not exceed fifty-nine cents ($0.59) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate? Passed 86% to 14%
May 4th Washington Township For the next seven calendar years immediately following the holding of the referendum, shall the Metropolitan School District of Washington Township impose a property tax rate that does not exceed eight cents ($0.08) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate? Passed 72% to 28%
May 4th West Lafayette For the seven calendar years immediately following the holding of the referendum, shall the school corporation impose a property tax rate that does not exceed forty-three cents ($0.43) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate? Passed 70% to 30%
May 4th Western Boone For the 2011 calendar year and six years thereafter, shall the Western Boone County Community School Corporation impose a property tax rate that does not exceed nineteen cents ($0.19) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate? (For voters in Clinton, Harrison, Jackson, Jefferson, Sugar Creek and Washington Townships)? Failed 69% to 31%

List of historical bond referendums

2009 Special Elections

Date District Bond Amount/Tax Cap Increase Passed/Failed  % Pass
November 3 Batesville Commununity Enter into a lease to finance the renovation of and improvements to Batesville High School, Batesville Intermediate School, Batesville Middle School and Batesville Primary School, in the following order of priority: (i) renovation of and improvements to the Batesville Intermediate School, Batesville Primary School and Batesville Middle School; (ii) academic needs at Batesville High School; and (iii) renovation of and improvements to Batesville High School, including, but not limited to, renovation of the auditorium, construction of a swimming pool, and the renovation of and improvements to other physical education space (collectively, the “Project”), which Project is estimated to cost not more than $28,000,000 and is estimated to increase the property tax rate for debt service by a maximum of $ 0.44?” NOTE: The referendum took place in two counties and the overall result must be in the majority. Failed 56.6 to 43.4%
November 3 Beech Grove City For the next seven calendar years immediately following the holding of the referendum, shall the Beech Grove City Schools impose a property tax rate that does not exceed thirty-five cents ($0.35) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate Passed 62.7% to 37.3%
February 3 Clinton Central Issue bonds or enter into a lease to finance the renovation of and improvements to Clinton Central Elementary School and Clinton Central Junior/Senior High School Defeated 85.8% to 14.2%
May 19 Delphi Issue bonds or enter into a lease to finance the renovation and upgrading of the existing facility in which the Delphi Community High School and Delphi Community Middle School is located Defeated 60% to 40%
November 3 Franklin Township-Question 1 For the next seven calendar years immediately following the holding of the referendum, shall the Franklin Township Community School Corporation impose a property tax rate that does not exceed thirty-three and one-third cents ($0.333) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate. Failed 69.2% to 30.8%
November 3 Franklin Township-Question 2 For the next seven calendar years immediately following the holding of the referendum, shall the Franklin Township Community School Corporation impose a property tax rate that does not exceed sixteen and two-thirds cents ($0.1667) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate Defeated 68.5% to 31.5%
January 13 Kankakee Valley Issue bonds or enter into a lease to finance the construction of a new middle school and the renovation of and improvements to Wheatfield Elementary School, Kankakee Valley Middle School and Kankakee Valley High School. Passed 70.7% to 29.3%
June 16 Lake Central Issue bonds or enter into a lease to finance the renovation and expansion of Lake Central High school and the construction of service center complex at an estimated net cost of $95,000,000? Defeated 58.6% to 41.4%
June 20 Maconaquah Issue bonds or enter into a lease to finance a proposed renovation of and improvement to the Maconaquah High School Building, the Maconaquah Middle School Building and the related campus Defeated 56.7% to 43.3%
May 19 Michigan City Issue bonds or enter into a lease to finance the renovation of and additions and improvements to the existing AK Smith Career Center building and the construction of a new career center facility at the existing high school? Defeated 67.8% to 32.2%
May 19 Mooresville-Question 1 Issue bonds or enter into a lease for the construction and equipping of a new 6-8 grade school building. Defeated 61.6% to 38.4%
May 19 Mooresville-Question 2 Issue bonds or enter into a lease for the renovation, construction of additions, and equipping of the existing high school building Defeated 59% to 41%
May 19 Nineveh-Hensley-Jackson Issue bonds or enter into a lease to finance a new elementary school building and the renovation of and improvements to Indian Creek Intermediate School and Indian Creek High School? Defeated 71.5% to 28.5%
January 9 Noblesville Issue bonds or enter into a lease to finance the construction of a new elementary school; the purchase of real estate; the reconfiguration of and construction of additions to the current Noblesville Intermediate School to convert it to a middle school, including site improvements; and the renovation of and construction of additions to the Noblesville High School, North Elementary School, and Noblesville Middle School Defeated 51.1% to 48.9%
November 3 Perry Township Issue bonds or enter into a lease to finance the Building Futures Project – Initial Phase, which is estimated to cost not more than $98,885,000 and is estimated to increase the property tax rate for debt service by a maximum of $ 0.2641? Failed 52.1% to 47.9%
May 19 Porterville Township Issue bonds or enter into a lease to finance the renovation of and additions to the Boone Grove High School Building. Defeated 74.4% to 25.6%
April 21 Southwest Allen County For the seven calendar years immediately following the holding of the referendum, impose a property tax rate that does not exceed 17 cents ($ 0.17) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate. Passed 70.5% to 29.5%
November 3 Southwest DuBois County Issue bonds or enter into a lease to finance the renovation of and improvements to Southridge High School and Southridge Middle School (collectively, the “Project”), which Project is estimated to cost not more than $22,500,000 and is estimated to increase the property tax rate for debt service by a maximum of $ 0.59?” Passed 55.2% to 44.8%
November 3 Southern Wells For the next seven calendar years immediately following the holding of the referendum, shall the Southern Wells Community Schools impose a property tax rate that does not exceed 12.7 cents ($0.127) on each one hundred dollars ($100) of assessed valuation and that is in addition to the school corporation’s normal tuition support tax rate?” Passed 52.1% to 47.9%
November 3 Tell-City Troy Township issue bonds or enter into a lease to finance the renovation of and improvements to Tell City High School to accommodate grades 7-12 (collectively, the “Project”), which Project is estimated to cost not more than $10,000,000 and is estimated to increase the property tax rate for debt service by a maximum of $ 0.28?” Defeated 50.8% to 49.2%

See also

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Suggest a link

External links

References

  1. "Indiana General Assembly" Indiana Bond Issue Law(Referenced Statute 6-1.1-20-3.5 Indiana Code, Sections 1A-1C)
  2. "Indiana General Assembly" Indiana Bond Issue Law(Referenced Statute IC 6-1.1-20-1.1 Indiana Code, Sections 1-7)
  3. 3.0 3.1 "Indiana General Assembly Indiana Property Tax Law(Referenced Statute 6-1.1-20.6-7 Sections C-E, Indiana Code)
  4. "Indiana General Assembly" Indiana Election Law(Referenced Statute IC 20-46-1-8, Sections A and B)
  5. "Indiana.gov" Indiana Property Tax Law(Referenced Statute 6-1.1-18-3 Indiana Revised Statutes)
  6. "Indiana.gov" Indiana Property Tax Law(Referenced Statute 6-1.1-18-1 Indiana Revised Statutes)
  7. "Indiana General Assembly" Indiana Election Law(Referenced Statute 20-46-1-14, Section C)
  8. "Indiana General Assembly" Indiana Election Law(Referenced Statute 6-1.1-20-3.6, Section G(1) Indiana Code)
  9. "Indiana General Assembly" Indiana Election Law(Referenced Statute 20-46-1-19, Section 19 Indiana Code)
  10. "Indiana General Assembly" Indiana Election Law(Referenced Statute 6-1.1-20-3.6, Section G(2) Indiana Code)
  11. "Indiana General Assembly" Indiana Election Law(Referenced Statute 20-46-1-19, Section 2 Indiana Code)
  12. "Indiana General Assembly" Indiana Election Law(Referenced Statute 20-46-1-14, Sections A and F)
  13. "Indiana General Assembly" Indiana Election Law(Referenced Statute 20-46-6-19, Sections A-C Indiana Code)
  14. "Indiana General Assembly" Indiana Bond Issue Law(Referenced Statute 6-1.1-20-3.6 (b,c) Indiana Code)
  15. "Indiana.gov" Indiana School Bond Law(Referenced Statute 20-46-1-10 Indiana Code)
  16. 16.0 16.1 "Indiana General Assembly" Indiana Bond Issue Law(Referenced Statute IC 6-1.1-20-3.5 Indiana Code, Sections 4-11)
  17. "Indiana General Assembly" Indiana Bond Issue Law(Referenced Statute 6-1.1-20-3.6 (d) Indiana Code, Sections 1-2)
  18. "Indiana.gov" Indiana School Bond Law(Referenced Statute 20-46-1-14 Indiana Code)