Tri‑Creek holds public hearing on 2026 budget; district projects $1.9M tax revenue loss from new state law

Tri‑Creek School Corporation opened a public hearing Wednesday on its proposed 2026 calendar-year budget, the five‑year bus replacement plan and a three‑year capital projects plan. Dana, a staff member who presented the budget, told the board the district expects a substantial circuit‑breaker tax credit impact tied to recent state changes and outlined steps the district plans to take to balance operations and education funds.

The hearing drew a detailed explanation of how school finance works in Indiana and projections showing the new Senate Enrolled Act 1 deductions will reduce Tri‑Creek’s net assessed value. "A budget's a plan of expenditures and revenues that, you know, at any given time, it would support our educational...programs that we want," Dana said during her presentation.

The presenter said the district's net assessed value (NAV) is 2,029,299,813 on the district’s current books and that, under modeling the district commissioned, circuit‑breaker tax credits could rise to about $1.9 million in 2026. That reduction would shrink the revenue the district can raise through its operations fund and increase the portion of the district budget the board must cover by transfer from the education fund.

Why it matters: Tri‑Creek’s operations fund is property‑tax driven and limited by state rules to a 4% annual increase in revenue; many cost drivers—utilities, bus purchases and insurance—are rising faster than that cap. Dana said a combination of higher fixed costs and the state’s changes to homestead and business personal property deductions could force Tri‑Creek to extend bus replacement cycles and rely more on transfers from the education fund.

Key numbers and assumptions - Proposed education fund budget: $25,500,000 (same as prior year on a presented basis). - Proposed operations fund budget: $9,766,000. - District NAV (presented): 2,029,299,813 (reported as a net assessed value figure in the presentation). - Estimated circuit‑breaker tax credit / revenue loss for 2026: approximately $1,900,000 (presenter cited Department of Local Government Finance spreadsheets that produced a similar figure: 1,863,000 in a DLGF sheet. - Transfer from education to operations proposed in the presentation: $2,600,000 (about 10.48% of state tuition support in the presenter’s spreadsheet), compared with prior years’ transfers of 6.2%–7.6%.

Presenter's explanation and context Dana walked the board through terms that affect local taxation and school revenue—assessed value, net assessed value, tax rates, tax levy and the circuit‑breaker credit mechanism. She explained that Senate Enrolled Act 1 changes homestead and nonhomestead deductions and substantially increases the supplemental homestead credit over a multi‑year phase in, which reduces NAV and therefore the tax levy that can be raised.

She also explained business personal property exemptions are being raised (from $80,000 to $2,000,000 in the presenter’s description), removing much small‑ and mid‑size business equipment from the tax base. The presenter said depreciation rules for business personal property were also changed, allowing the assessed value to drop to zero rather than bottoming out at a fixed floor.

Operational pressures and planned responses Dana described cost pressures the district faces: an approximate 17% increase in some utility costs, a roughly 12% increase in liability insurance, and bus prices that have risen—she cited a current bus cost near $190,000 compared with roughly $115,000 about 12 years ago. The district plans to: - Extend bus replacement cycles to roughly 12–14 years (from a previous 10–12 year replacement practice) to manage costs under constrained revenue. - Continue to use short‑term bonds to purchase buses (the district has issued letters of intent and plans purchases under 2025 bonds; the presenter said buses ordered now would not arrive for about two years and can be canceled if funding isn’t available at delivery). - Use common school fund loans (low‑interest) for technology and other capital work where feasible.

Enrollment and revenue drivers Dana emphasized that 99% of the education fund revenue is enrollment driven. The district’s current average daily membership (ADM) reported in the presentation was 3,286 students, including 38 virtual students. Tri‑Creek receives $7,286 in basic funding per in‑person student and 85% of that for virtual students (the presenter cited $5,922 per virtual student). The district reported modest growth or stabilization in recent kindergarten cohorts but stressed the difficulty of predicting February enrollment counts that determine state tuition support for the next budget year.

Budget prudence and reserves The presenter said Tri‑Creek has been building a reserve since federal ESSER funds and COVID‑era grants were available, with ending balances at levels the district called "more than prudent" in recent years. The proposed 2026 budget was presented as balanced but showing much smaller additions to reserves going forward. Dana also noted a new state reporting requirement raising the minimum proportion of state tuition support that must be spent on full‑time teacher compensation from 62% to 65% and said the district will monitor staffing and compensation to remain compliant.

What the board will vote on next Dana said the board will be asked to adopt the advertised resolutions and tax rates at a future meeting (the presenter mentioned an adoption meeting on October 23). Between the board's adoption and year end, the Department of Local Government Finance (DLGF) will review and issue the budget order; the presenter named Jan. 1 as the target for DLGF issuance but did not assert a guaranteed date.

Public hearing and questions After the presentation, the hearing opened for public comment and questions; the presenter then closed the public hearing. No substantive public objections to the assumptions were presented during the hearing portion transcribed.

Ending The hearing concluded with the presenter thanking attendees and reminding the board of next steps: formal adoption at the scheduled meeting and DLGF review before the statutory deadline.