By Patrick Mapes
Superintendent of Hamilton Southeastern Schools
By Dr. Juanita Albright
President of the Hamilton Southeastern School Board
Indiana’s new property tax law (Senate Enrolled Act 1) is creating significant funding challenges for school districts across the state, including Hamilton Southeastern Schools. Starting in 2026, we’re facing a $4.5 million annual revenue loss due to the supplemental homestead credit, and this impact will continue growing each year.
At the same time, declining enrollment over the last several years means less state funding, which is particularly challenging since 92 percent of our education fund goes directly to teacher salaries and benefits. These combined pressures from the state’s comprehensive school funding reform have created immediate challenges that must be addressed.
Rather than wait for these funding restrictions to hit, we’ve been proactive over the past year, working together to make every dollar work harder without eliminating any teaching positions. Health insurance reforms saved $1.5 million in district contributions while preserving coverage for our staff. Bond refinancing redirected another $1.35 million to future facility upgrades, and targeted audits recovered more than $200,000 in efficiencies. These difficult decisions reflect our shared commitment to protect our intent to ensure every HSE student receives an exceptional education.
Two major decisions on the horizon will shape the next decade: redistricting and referendum funding. We’re currently discussing redistricting to address growth in the northern part of our school district while managing an overall district-wide enrollment decline. This effort to balance enrollment across our 23 schools and approximately 1,500 daily bus routes ensures teachers have the resources they need and every building can continue offering robust programming.
Looking forward, implementation of SEA-1 is having a significant impact on referendum funding across the state. While we hope the General Assembly will consider constructive fixes to some of these areas of difficulty, we’re taking proactive action to ensure our students’ experiences exceed the standard our community expects.
In 2026, approximately 97 percent of our referendum fund will be dedicated to teachers’ salaries and benefits. More specifically, our referendum fund covers the salaries and benefits for teachers in five of our school buildings, including one of our high schools. This equates to approximately $29 million per year in 2026, or $2.4 million per month. While we were grateful that our community showed strong support in approving our 2023 referendum, no one anticipated that the state would fundamentally change how these funds operate.
Starting in 2027, SEA-1 will negatively impact our referendum fund, compared to pre-SEA-1 projected revenue by approximately $2.2 million. This negative impact will compound annually, as we project to lose more than $4 million compared to previously projected revenue in 2028. Due to decisions made last legislative session, HSE will not be able to maintain future programs, class sizes, or staffing levels without voter approval. Accordingly, HSE is discussing the option to seek early renewal of its referendum in 2026 to counteract the state’s restrictive funding measures.
To be clear, we are not alone in this position. We’re already hearing from and anticipate that a large number of school districts across the state will seek early referendum renewals in 2026 because state funding simply doesn’t cover quality education costs. As we work through HSE’s 2026 budget and contract negotiations with our teachers, our shared goal remains that Hamilton Southeastern Schools will be stronger in the years ahead. We’re working hard to maintain our current level of staffing and services for the 2025-2026 school year to ensure every HSE student receives an exceptional education experience.
The same spirit that built this district into one of Indiana’s best now guides us through these changes. Working together, we’re committed to a collaborative, data-driven path forward that recognizes today’s investments in efficiency and innovation will determine what HSE becomes for the next generation.