The bill to dissolve IPS might not move. Are lawmakers using it as a bargaining chip?

Yahoo

29-01-2025

Key Indiana lawmakers are signaling that one of the most attention-grabbing bills filed in the Indiana General Assembly this year — a proposal to dissolve Indianapolis Public Schools entirely and turn it into charter schools — is not seriously on the table this legislative session.
Instead, the bill, which has prompted strong opposition from both the school district and its supporters, appears to be part of a negotiating strategy aimed at something else entirely. Lawmakers want IPS, and other public schools, to share the property tax money they get each year from residents with the charter schools and other traditional public schools that serve students. For years IPS and local charter schools have argued over the idea.
About half of the nearly 50,000 children who are within the IPS's attendance boundaries attend charter schools and other traditional public schools. More than 1,400 students living within the district's lines, for example, instead attend nearby Lawrence Township schools, and more than 800 each attend the charters Victory College Prep and Christel House Academy South.
The controversial House Bill 1136 is part of flurry of legislation targeting IPS and its coffers this legislative session. Another bill would outsource transportation and operations money from IPS to another entity. Even if all of the proposals don't become law, local community leaders say they're concerning.
Tony Mason, president and CEO of the Indianapolis Urban League, criticized "conversation-starter bills" like HB 1136.
"Don't start it through the introduction of bills that would attack the district in its very existence," Mason said. "They appear to be focused on forcing the district to capitulate to provide funding, transportation and facilities to unaffiliated schools."
Indiana House Speaker Todd Huston said he was more focused on revenue-sharing than the bill to dissolve IPS when asked about it earlier in January by reporters. He was asked directly if the legislation was aimed at trying to force a compromise.
"My biggest issue is that the districts share revenue — local property tax dollars — to support these students," Huston said. "If we can do things without legislative action, I'd love to do that."
House Education Committee Chairman Bob Behning, R-Indianapolis, pointed out to IndyStar that he still hasn't scheduled a hearing for the controversial bill, a necessary first step in moving it forward through the legislative process.
"It's probably too early to judge us on where we are until the process is complete," Behning said.
Meanwhile, Behning said, he is in conversation with IPS officials.
"They understand that there's an interest by several that would like to see revenue sharing," he said.
The more likely change lawmakers are considering lies in Senate Bill 518, which would require all school districts to share more of their property-tax revenue.
The bill could potentially shift $124 million to charter schools and $436 million to other traditional public schools between 2026 and 2028, according to a legislative report on the bill's fiscal impact, though it's unclear at this point how individual districts and charter schools would be impacted.
The bill's lead author, Sen. Linda Rogers, R-Granger, told IndyStar she is still working on the bill and declined to comment further. That bill also doesn't yet have a committee hearing scheduled.
In a statement, IPS said bills including SB 518 would have "profound effects" on the district.
"We're working rapidly both internally and externally — with lawmakers and our lobbyists — to advocate for the best interests of all Indianapolis students," according to a statement from the district. "As we have reviewed SB 518, we know that there would be a significant financial impact on the future operations fund of the district."
IPS collected about $90 million in property taxes overall in 2023, an increase of nearly 30% since 2019. IPS already has to share a portion of newly generated tax revenue from referendums with charter schools, but lawmakers including Behning want that sharing to be more widespread.
"Every parent, regardless of whether or not they choose the incumbent ... school district, are paying those property taxes," Behning said. "How do we better distribute that?"
While IPS says it's worried about the financial ramifications of SB 518, other public districts might not be in the same boat. Wayne Township schools, for example, has hundreds of students who choose to attend the district despite living in another district's boundaries.
The bill would result in the township district sending revenue to about 75 school districts and charter schools while receiving revenue from approximately 115 traditional public school districts, said spokesperson Jeannine Templeman. However, the district was unsure of the bill's exact economic impact.
"We will continue to work collaboratively with neighboring districts and legislators throughout the session on this and many other education-related bills," Templeman said.
Warren Township schools, which lose a net nearly 90 students annually to other public districts and charters, told IndyStar in a statement that voters expect their property taxes will be used to support their local public school districts.
"We encourage the General Assembly to safeguard this critical connection between local taxpayers and their local school districts, ensuring that these institutions remain strong and continue to meet the needs of the communities they serve," said Dennis Jarrett, a spokesperson for Warren Township schools.
Even as discussion among lawmakers and lobbyists has moved to property-tax sharing, fears about dissolving IPS remain outside of the four walls of the Indiana Statehouse.
Leaders from the African American Coalition of Indianapolis, for example, held a press conference last week to decry a lack of transparency over the legislative process while negotiations between the district and lawmakers take place behind the scenes. Meanwhile, those leaders said, kids and families are scared.
"This has seemed very top down," said Willis Bright, chairman of the African American Coalition of Indianapolis. "Where have been the conversations with the families that will be most impacted by the shifts and changes that are being proposed?"
Lobbyists who are closely watching education bills said it's important to watch the process closely even though they're skeptical that the bill to dissolve IPS will move forward.
"It's a long legislative session," said Scott Bowling, executive director of the Indiana Association of School Business Officials Inc., which lobbies for public school districts' financial interests. "... Those concepts can come back. I would say be vigilant but don't panic."
The conversation about sharing property taxes, on the other hand, is a concept that "keeps coming back," Bowling said.
"It falls right in line with what they're talking about in terms of dollars following the child," he said. "We're still working on what our position on that is going to be. We want to make sure funding is strong for all different types of public schools in the state."
Contact senior government accountability reporter Hayleigh Colombo at [e-mail].
This article originally appeared on Indianapolis Star: Indiana lawmakers use controversial IPS dissolution bill to negotiate