Consultant warns Senate Enrolled Act 1 could cut Griffith referendum revenue beginning 2028

Griffith Public Schools’ municipal adviser told the board that changes in Indiana’s Senate Enrolled Act 1 will lower property-tax receipts for the district beginning in 2028 and could reduce referendum revenue unless state or local remedies are adopted.

Sean McGill, senior manager and municipal adviser with Baker Tilly, summarized provisions in the law adopted earlier that he said aim to reduce homeowner property-tax bills by increasing deductions and adding a homeowner credit. McGill said some credits previously funded by local income tax — called property-tax replacement credits in Lake County — will be eliminated in 2028 and that the lost revenue will instead operate through circuit-breaker caps that are not reimbursed to taxing units.

That shift, McGill said, could reduce district property-tax receipts by a significant percentage, projecting that the district could face up to about a 15% reduction in property-tax receipts beginning in 2028 under current projections. He said Griffith’s near-term outlook (2026–27) looks manageable under the district’s proposed salary and benefits changes and planned staffing attrition, but the 2028 changes to replacement credits and local income tax make long-range projections uncertain.

McGill reviewed other features of the law, including new limitations on when a district can run a referendum and caps on local income tax. He said the state has set a maximum local income tax expenditure rate (2.9% maximum with current rates at 2.5%) and that nonmunicipal units such as school corporations are limited in how much of a share they can receive from a county local income tax allocation. He also noted the law changes referendum ballot language and requires districts to specify a maximum tax rate and maximum levy for referendum questions.

Board members and members of the public asked about timing: if a district’s operating referendum was passed in 2022 for eight years, McGill said districts will need to consider whether to seek renewal in November 2028 or 2030; running in 2028 could replace the existing referendum, while failure of a renewal in 2030 could lead to a two-year gap without referendum revenue. He said some districts are considering earlier renewals to avoid risk from the law’s 2028 changes.

McGill offered to provide further written materials and to return in a longer format. Board members did not take a formal action during the presentation but acknowledged the need to factor the law into long-term financial planning.