Indianapolis schools and homeowners could be affected by proposed tax increases

School tax question reaches families

Indianapolis families and homeowners are facing a school funding question that could show up on November ballots and later on property tax bills across the IPS area.

The new Indianapolis Public Education Corporation is weighing whether to ask voters for a referendum that would support district schools and eligible charter schools during a difficult budget stretch.

A new board holds the decision

The Indianapolis Public Education Corporation, known as IPEC, was created by state lawmakers to oversee key financial and operational pieces of Indianapolis public education.

That means the power to place this school tax question on the ballot has shifted from the elected IPS board to a mayor-appointed body with 9 members and broader authority under state law.

The current tax is expiring

Voters approved the current IPS operating referendum in 2018, setting the rate at 19 cents per $100 of assessed property value for local school support.

That tax brings in about $49 million each year for the district, but it expires at the end of 2026 unless voters approve another measure to replace it for schools.

Rates range from 19 to 55 cents

At a May IPEC meeting, presenters discussed possible referendum rates ranging from 19 cents to 55 cents per $100 of assessed value for local homeowners.

The board can choose one of those options, pick a different rate, or decide not to seek a referendum at all this year before the ballot deadline arrives in Indiana.

Homeowners would feel the change

The rate matters because it affects what homeowners pay beyond regular property taxes. Reports estimate annual costs from about $170 to $475 for a $200,000 home.

Those figures are tied to possible referendum rates, so even small rate changes can matter for families already worried about housing costs, fixed incomes, and monthly budgets in Indianapolis.

Schools say needs are rising

IPS leaders say funding pressures are tied to services that students use every day, including special education, English learner support, transportation, staffing, and classroom programs.

Superintendent Aleesia Johnson told IPEC that about 27,000 students rely on IPS services that could be affected by the final referendum decision this year if funding changes locally, too.

Charter schools change the math

The process differs from 2018 because charter schools enrolling students who live inside IPS boundaries can opt into receiving money from the tax measure, too.

Officials said the change would nearly double the number of students supported by referendum funds, which is why IPEC materials list about 39 cents per $100 of assessed value as the parity option for the city.

Cuts could still happen

If voters reject a referendum or approve a lower rate, IPS officials say the district may still need cuts beyond those already announced this year.

Possible changes could include school closures, consolidations, ending some Innovation Network agreements, or reductions to instructional programs, transportation, and staffing across schools if revenue falls short after the vote later.

Higher rates bring concerns

Supporters of a higher rate say more money could give schools stability during a period of major changes for Indianapolis education and student services, too.

Some homeowners worry the same proposal could strain household budgets, especially for people on fixed incomes or residents already facing higher property tax bills each year in their neighborhoods now.

Little-known fact: Montgomery County has the lowest commercial property tax rate in the Washington metropolitan area.

Public feedback shaped the debate

IPEC scheduled public listening sessions so families, educators, homeowners, and community members could respond before the board takes its next major vote on the plan ahead.

Educators urged stronger school funding, while some taxpayers questioned how much more residents should pay as the district and charter schools prepare for a new system this fall locally.

The timeline is tight

IPEC members are expected to decide at their June 22 meeting whether to place a referendum on the November ballot for IPS-area voters this year.

The timeline is tight because IPEC-specific reporting points to a July 22 deadline to send the ballot question to the Department of Local Government Finance, while Indiana law requires certification of the question by noon Aug. 1.

The measure may be shorter

School referendums often last 8 years, but IPS leaders and TogetherEd’s Andy Seibert recommended a 4-year measure for this proposal instead, locally this time.

That shorter timeline could give Indianapolis a bridge during the transition, while allowing voters to review the new education system again before committing to a longer period of funding later locally.

Wondering why Indianapolis Public Schools is cutting central office costs? Learn how the reductions could shape next year’s budget.

The choice reaches beyond schools

The referendum decision is not only a school finance question. It also affects homeowners, renters, families, teachers, charter operators, and neighborhoods across Indianapolis.

Voters may soon decide how much local money should support students while balancing real concerns about affordability, taxes, services, and the future of public education in the city for years ahead.

How could canceled English learner grants affect Rhode Island students? See why the lawsuit is raising questions about school support and funding.

What do you think Indianapolis should weigh most before moving ahead with proposed tax increases? Share your thoughts in the comments.

This slideshow was made with AI assistance and human editing.

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