State refuses to bail out Muncie Community Schools on buses

Waiver to end service denied Layoffs besides school closing could be next

By Rick Yencer

MUNCIE, INDIANA (NEWS) - Muncie Community School officials and their Tea Party opponents to higher taxes agreed it was no surprise Friday when the Indiana Department of Education declined to bail out their transportation needs.

 The state denied a waiver to delay ending bus service for about 6,600 Muncie school students, many who now use Muncie city buses for transportation.

School officials offered a brief statement, saying the state's action was not a surprise.

As school officials said during the waiver hearing in December, "Muncie Community Schools needs and wants buses to transport students. 

However, the state said the funds were not available after the schools failed to get taxpayers to support a referendum to raise more taxes for transportation.

"The protected tax statute requires school officials to prioritize payments to debt services at the expense of other non-protected funds such as the capital projects, transportation or bus replacement funds," school officials said.

That unenviable position now means the school system has to come up with as much as $3 million to continue bus service as it is now.

And Mark Burkhart, outgoing chief financial officer, said that search would have to come from existing sources whether it is layoff of staff or teachers or other cutbacks in programs.

Burkhart has quit as financial officer, leaving MCS to find a new financial leader. He has overseen school finances for more than 30 years and orchestrated the referendum that was rejected by taxpayers.

Chris Hiatt, of the Good Government group, also was not surprised by the state's action. He provided evidence at the hearing last year about the school having money to run buses without raising taxes.

 Hiatt also called for the resignation of school administrators, including Supt. Tim Heller, and school board members, and suggested citizens elect "can do" school officials that can operate and provide education at a reasonable cost to taxpayers.

 Other taxpayers suggested the schools refinance its massive $50 million debt and transfer money from its general fund to pay for transportation that had been depleted by property tax caps and other protections again transferring education money for transportation.

The schools operate on a $77 million budget and officials insisted that was not enough to operate schools and run buses. Some taxpayers said the schools should borrow more money until it receives money from closing schools.

MCS just decided to consolidate high schools which could save more than $1.8 million. But that saving will not be seen for two years.

Burkhart said another option could be an effort by state lawmakers to repeal protected property taxes exempt from tax caps.

Rep. Sue Errington, D-Muncie, is sponsoring the bill and has the attention of House Ways and Means Committee Chairman Tim Brown, a Republican from Brownsburg.

 A study of 2013 levies and circuit breakers losses found that if protected taxes law had been effect last year, three school corporations would have completely exhausted their levies in nondebt funds. Another 15 school corporations would have lost at least 50 percent of their nondebt levies to circuit breakers losses.

 Errington hoped to enlist other Republican support for the financial fix to help public schools losing money to tax caps. Republicans hold super majorities in the House and Senate.

The school board meets Tuesday at 6:30 p.m. in the school administration office to continue discussion about bus service. And Errington and Sen. Tim Lanane, D-Anderson are holding at town hall Jan. 18 at the Forest Park Senior Citizen Center to talk about education and protected taxes.

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