The School City of Hobart is facing a grim fiscal reality if state lawmakers don’t act soon to modify a property tax relief bill approved by legislators last year.
Superintendent Peggy Buffington told the school board Thursday the district would receive zero property tax dollars in the 2026-27 school year under the measure. The tax money supports the district’s operating fund, which finances bus transportation, utility bills, repairs and maintenance.
If the law isn’t tweaked, she said it could result in layoffs and program cuts.
Just last May, Hobart taxpayers backed an eight-year $22.8 million property tax referendum for the operating fund to keep its bus service afloat.
Buffington said the district already loses 81.6% of its tax levy to property tax caps enshrined in the state constitution by lawmakers in 2010. With SEA 1’s impact layered on top, Buffington said Hobart stands to lose 104% of its levy in 2026 and 110% in 2027.
Buffington brought Hobart’s case to lawmakers this week and said she hoped it made a difference.
She said she spent about 30 minutes with senators and representatives. She said many didn’t realize what the new law does to districts like Hobart, which are heavily residential with little industry to support them.
“I’m very hopeful but they’re in a tough spot; it’s a short session,” Buffington said.
The General Assembly reconvened Monday after opening the short session in December to consider redistricting the state’s congressional districts. That effort failed.
Legislative leaders say they hope the session can conclude by the end of February. Typically, lawmakers don’t make budget changes during a short session.
Republican Gov. Mike Braun and GOP lawmakers championed Senate Enrolled Act 1 last year because they said taxpayers told them they needed property tax relief. Braun told schools and local governments to “do more with less.”
A legislative agency estimated the law would cut $744.2 million from Indiana public schools.
To stem the lack of tax dollars, the school board voted to hold a 7 p.m. Feb. 5 public hearing to take input on the sale of Ridge View school, a former elementary building at 3333 W. Old Ridge Road, previously leased to Geminus Head Start and the Hobart Family YMCA.
Officials said the sale would reduce the district’s operating fund expenses and generate additional revenue for the operating fund.
Students stopped attending Ridge View in 2020 when the district opened the $18 million Veterans at Mundell Elementary.
“I know it takes a lot to change a law but I think there are some things they can do in this short session for districts that are hurting,” said Buffington.
Meanwhile, the city of Hobart is also expecting to lose $5 to $7 million from SEA 1, said Mayor Josh Huddlestun, but the city is on course for a financial windfall from Amazon that wants to build a massive data center at 61st Avenue and Colorado Street.
Hobart schools, however, won’t gain tax revenue from the data center because it lies within the Merrillville Community School Corp. boundaries. The area is also in a tax increment finance zone, which will keep future taxes within the TIF.
If the Amazon project is finalized, Huddlestun said Friday, the city would create a community economic impact program that could provide funding to schools.
“We want to make sure our public education is strong in the future,” he said.
Besides a boundary that includes a section of Merrillville schools, Huddlestun said Hobart’s northern tier also includes students who live within the River Forest Community School Corp. boundary.
Carole Carlson is a freelance reporter for the Post-Tribune.