Stalled tax plan to revive Indianapolis Public Schools pushes charters and district further apart

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In the end, nobody got the money they wanted. 

The months-long effort to raise hundreds of millions of dollars in property taxes for Indianapolis Public Schools had adversaries from the start. 

The money was meant to fund the district’s Rebuilding Stronger plan, a massive reorganization to expand academic offerings, reconfigure grades, and make IPS schools more attractive to students as the district loses students to charter schools. 

But perhaps unsurprisingly, charter schools, which typically don’t receive property tax revenue, wanted a greater portion of that money than what the district was willing to offer. And opposition to the Rebuilding Stronger plan from parents and other community members lingered.

As a result, school board members hoping to put the tax measure to voters in May faced a formidable challenge: vocal parents and community members mobilized by well-funded groups that support charter schools — the same groups that supported the majority of those board members with heftycampaign contributions. 

Then in January came additional and influential opposition: The Indy Chamber — a powerful ally in the district’s successful 2018 referendum that also donated to several campaigns for sitting school board members — also announced it would not support the proposed ballot measure.  

Board members subsequently postponed their vote on the tax proposal, and are now working to salvage some kind of tax increase to put to voters in a different election. But the fallout from the last few months could hamstring the district’s long-term strategy to improve opportunities and outcomes for students. 

It also points to something many advocates and officials say is worrisome: a house divided. 

The district’s unique portfolio of charters and traditional public schools, created nearly a decade ago by IPS leaders and state lawmakers, has left both populations fighting for funding. And as state lawmakers push to expand school choice in Indiana, that competition might be for a shrinking financial pie. 

“If they both end up being under-resourced, they will both fail,” said Tony Mason, president and CEO of the Indianapolis Urban League. “And as we see an expansion of vouchers, ultimately what could happen is that parents will choose to take their vouchers and take their children to private and parochial schools.”

Those backing charter schools who criticized the board’s approach to the tax measure say their focus is ensuring that all students benefit equally from revenue earmarked for public education. 

EmpowerED Families, a group that spent more than $5,000 on radio ads opposing the tax measure, said in a statement this month that it supports those who “advocate for fairness and equal distribution of funds amongst all public schools.”

“This referendum could have been a win for ALL Indianapolis public school students in IPS’ district … but unfortunately, it left students out, many of whom are Black and Latino,” the group said.

But such arguments have frustrated some school board members, particularly when their critics have insinuated that the district doesn’t want to treat students of color equally with white students.

“I wake up every day and my child is Black, and I’m Black, and I’m a first-generation college graduate,” said board President Venita Moore. 

“People do those things when they try to divide a community,” she added. “And I feel like they were trying to divide a community.”

Two types of schools compete for funding

Throughout December and January, school board members sat silently through hours of public comment as they took the brunt of the charter sector’s ire. 

Charter advocates packed school board meetings and argued that commissioners would hurt Black and brown students if the operating referendum were passed. 

“My students have dreams just like any other students,” one parent and educator told the board. “Fund them all, and if you do not, it will be another betrayal of Black and brown families that I know everyone on the board cares about.”

The discord between the two types of schools stems from a taxing setup that leaves both school systems fighting over limited resources. 

Property tax revenues are capped in Indiana, but can be raised beyond the cap with the passage of a public ballot question. That means many school districts must seek voter approval to raise funding for initiatives like Rebuilding Stronger. Meanwhile, charter schools do not get property tax revenue, although they receive state grants to fund capital and operating needs. 

“In one relatively small geography, you have two school systems operating and targeting similar populations in a world where there just are not enough resources — either financial or human resources — to sustain two systems,” said IPS board member Will Pritchard. 

Unlike other districts, IPS has shared money from its previous operating referendum with charters in its Innovation Network — schools that are considered a part of IPS but are autonomous. But in the proposed 2023 referendum, IPS was not willing to share funding with charters that are independent from the district.

Other groups have been more sympathetic to IPS, coming to its defense against the charter sector.

The African American Coalition of Indianapolis denounced efforts to cast the referendum as an effort that would harm Black children. The group instead questioned the proliferation of charter schools within IPS boundaries, arguing that equity does not mean IPS children receive less so charter schools receive more. 

“The periodic haggling by some institutions in this community over what IPS and the Black and Brown children that matriculate in the district should have is not only shortsighted and counterproductive to workforce development, but also borders on paternalism,” the coalition said in its statement. 

(As a whole, independent charters as well as charters in the district-affiliated Innovation Network have a higher proportion of Black students than traditional IPS schools. Students of color make up a majority in all three sectors.) 

But the AACI, as well as the IPS Community Coalition, only shared sentiments of support several weeks after it became clear that the tax proposal to support Rebuilding Stronger wouldn’t make it onto the May ballot. 

Charter leaders, however, moved much more quickly. At a December press conference, for example, charter school supporters said the funding gap between independent charters and traditional public schools would grow to over $10,000 per student if voters were to approve the ballot measure for operating costs.

Charters see potential statehouse funding wins

State education policy shifts could deepen the divide between charters and IPS. 

Charters have so far had good news at the statehouse, where House Republicans have proposed more money per pupil to make up for the property tax revenue they generally do not receive.

And as the charter sector mobilized at IPS meetings, it has mobilized at the statehouse, too. 

In a public statement last week, Black charter school leaders called for a long-term solution to close the funding gap between charter school students and traditional public school students, which they estimated at over $7,000 per child in Indianapolis. 

“Yes, our families chose to attend our schools. But the reality is that we lead public schools,” the statement read. “Our students are public school students and they deserve to be valued and provided the funding necessary to thrive.”

Ads from a group calling itself the Indiana Student Funding Alliance have pushed a similar message.

The proposed budget from House Republicans would give charter schools a set amount per pupil for operating costs: $1,400 in 2024 and $1,500 in 2025. This would replace a current state grant for charters of $1,250 per student annually.

But the budget would also limit the tax rate that districts could set to pay for operating expenses, which could harm larger school districts.

Another bill would allow charter schools to petition for school buildings in traditional districts that are operating at less than 60% capacity. 

And public education advocates worry that the proposed legislation to expand vouchers could endanger state aid to public school students, whether they’re in a charter school or a traditional public school. 

“They’re giving more money to vouchers,” Moore said. “And we still don’t have anything.”

Shoring up support to improve school facilities

Despite the setbacks, IPS is making the rounds on selling its capital referendum to voters, which the school board passed in a unanimous vote in December.

The $410 million ballot question would help fund building needs for 23 school campuses. Some of those include Innovation charter schools in district buildings.

The referendum will improve buildings that are on average 61 years old, Superintendent Aleesia Johnson said in a Fox 59 interview last month. 

“If there’s a building that’s in need, we want to be sure that that building is getting what it needs to be a great environment for students,” Johnson said. 

The district estimates the tax increase would equate to an additional $3 per month for homeowners with a median value home.

Groups that were critical of Rebuilding Stronger and called for both independent and Innovation charters to receive referendum funding have had a mixed response to the referendum for capital costs.

RISE Indy, an education nonprofit that supports charter schools, said it supports the ballot question for capital projects. The Mind Trust, an influential organization that has incubated charter schools in Indianapolis, said it will not take a stance on the question. Stand for Children, which mobilized parents in support of charter schools at multiple board meetings, said it would not oppose the question.

The Indy Chamber stands by its decision not to support the referendum for capital projects. The group referred to its statement in January that the district should explore other revenue sources. Whether IPS can surmount that political obstacle and pass the capital referendum, given the chamber’s key role in the successful 2018 referendum, will be watched closely. 

“It’s a question of how actively is the Chamber going to campaign against it,” said Andy Downs, professor emeritus of the Mike Downs Center for Indiana Politics at Purdue University Fort Wayne. 

Moore, meanwhile, maintains her hope that the district will work out funding to expand academic opportunities under Rebuilding Stronger. The district plans to enact parts of the plan that will take effect in 2023-24, including the closure of several schools. 

“I just want IPS to continue to give the children who look like me an opportunity to be successful,” Moore said. “To be able to do things.”

Chalkbeat is a nonprofit news organization covering public education.