MSD Steuben County board reviews budget plan, advertises 2026 budget and authorizes up to $6.6 million in bonds

The MSD Steuben County School Board met Aug. 19 in the McCutcheon Administration Center Boardroom and, after a workshop on the 2026 budget and related planning, voted to advertise the 2026 proposed budget, a three‑year capital assets/projects plan and a five‑year bus replacement plan ahead of a public hearing set for Sept. 16. The board also adopted a resolution confirming a lease amendment and authorizing the school building corporation to issue bonds with a maximum principal amount of $6,600,000 and a maximum term of 15 years.

The budget presentation, delivered by Dr. Penrod, reviewed the district’s timeline and state review process. The school will post a notice of its Sept. 16 public hearing in the state’s Gateway system by Sept. 6, per Department of Local Government Finance (DLGF) procedures, and intends to adopt a final budget in October and submit it to the DLGF before the Nov. 1 statutory deadline. Penrod emphasized that Gateway is the public site for budget, tax and levy information and that the district will use the standard DLGF forms and the statutory 1782 notice process that follows DLGF review.

Why it matters: the board’s budget and debt decisions determine how much revenue the district requests from property tax levies, how much will be transferred among funds if needed (the board asked permission for intra‑fund transfers and a not‑to‑exceed 15% transfer from the education fund to the operations fund), and how debt service payments will be structured. The board’s actions tonight set the advertisement and public‑notice steps required before the DLGF finalizes tax rates and the county issues the budget order.

Key details from the workshop

- Foundation amount and curriculum materials: Penrod said the state foundation (the “basic grant”) was set at $6,967 per student for the current budget cycle and noted a portion of previous textbook/curricular materials reimbursements (CMR) has been rolled into the foundation. He warned that because CMR was folded into the foundation number, some districts could effectively see less discretionary revenue than the headline percentage increase suggests once CMR is removed from year‑to‑year comparisons.

- Complexity index and direct certification: Penrod explained that direct certifications for SNAP, TANF and foster students feed a separate complexity index that is rolled into the basic grant; the complexity foundation declined slightly (from $4,027 to $4,001 in the presenter’s slides).

- Debt service and anticipated debt: the presentation reviewed existing lease and general obligation bonds and various state common school loans used for technology. Penrod said the district might advertise higher debt figures initially as an anticipated (worst‑case) debt service amount; actual levy and rate effects will be adjusted once final bond terms and the county’s assessed valuation (AV) are known. He said an anticipated debt service figure was shown in the materials (presenter cited a projected debt service line item of about $6,000,008.23 as presented).

- Senate Enrolled Act 1 and levy/rate effects: Penrod summarized elements of Senate Enrolled Act 1 (often discussed as “rollback 1”), the Maximum Levy Growth Quotient (MLGQ), and the potential long‑term effect of shifting homestead/supplemental exemptions on assessed value and school revenue. He said the law is intended to shift homeowner relief toward larger supplemental credits by 2031 and warned that over time that could reduce certified net assessed value (CNAV) and push rates higher even if levies remain constant.

Board action and public participation

The public hearing portion for the bond/lease item drew no public commenters, and the board proceeded with motions later in the agenda. The board voted unanimously to advertise the budget and plans on Gateway and to adopt the bond‑related resolutions authorizing a lease amendment confirmation and a bond appropriation not to exceed $6,600,000 with a maximum 15‑year term. The board also voted on several routine items (personnel, policies, MOUs, donations) during the meeting; those items are summarized below in “Votes at a glance.”

Votes at a glance (outcomes recorded at the meeting)

- Motion to advertise the 2026 proposed budget, three‑year capital assets/projects plan and five‑year bus replacement plan for the Sept. 16 public hearing: approved (vote recorded as 7–0).

- Resolution confirming the lease amendment and authorizing issuance of building corporation bonds (maximum $6,600,000; maximum term 15 years): adopted (7–0). The resolution also included an additional appropriation to account for bond proceeds and investment earnings.

- Personnel and personnel addendum (including hiring Dana Reed as media center IA and a slate of resignations/appointments/reassignments in the personnel packet): approved; personnel packet vote recorded as 6–0 with one abstention noted on the roll call for that item.

- Acceptance of donations from Farmers State Bank (jeans fund to support boomerang backpacks; donation to food service to clear student arrears): accepted (7–0).

- Approval of adjunct instructors (fire science instructors and an elementary music adjunct): approved (7–0).

- Memoranda of Understanding (MOUs) and partnerships: approved (all 7–0): Advanced College Project MOU with Indiana University (dual‑credit chemistry option), Freedom Academy health sciences MOU (CTE instruction, certification plans), Goodwill Industries pre‑employment transition services (pre‑ETS) MOU, and an MOU with the City of Angola for a trails project that will convert existing sidewalks in front of Henry Park to a 10‑foot trail alignment.

- Policies: second readings and adoption (both 7–0): staff technology acceptable use policy (4261) and the harassment policy (4118) as presented.

What the board did not decide tonight

No final budget adoption occurred tonight; the board authorized advertisement and scheduled the public hearing for Sept. 16. Bond sale structuring and final levy impacts will be determined after bond pricing, final terms and the county’s certified AV are available. Penrod said the district will use the statutory 1782 notice process to respond to any DLGF changes after submission.

Next steps and calendar

- The district will post the budget, bus replacement plan and capital plans on Gateway by Sept. 6. A public hearing is scheduled for the Sept. 16 board meeting. The board expects to ask for final adoption of the 2026 budget and related resolutions at the Oct. 21 meeting, with submission to the DLGF by Nov. 1.

- Bond sale parameters were authorized tonight; district staff and bond counsel will return with final sale documents to structure payments and report final levy/rate effects after pricing and when the county’s AV is available.

Upcoming meetings: Sept. 16, Oct. 21, Nov. 18 (all at 6 p.m., McCutcheon Administration Center Boardroom).

Sources: meeting presentation and motions at the MSD Steuben County School Board meeting, Aug. 19, 2025; Department of Local Government Finance procedures and Gateway requirements referenced by the presenter.