ECS Board of School Trustees’ Meeting 7/22/25

001Thank you. [Music] >> All right. Uh, thank you everyone for coming out. uh to our uh public work session uh for Elcar Community Schools on uh for this July 22nd. At this time, I'd like to call the public work session to order. And I'd like at this time turn it over to policy analytics to uh discuss Senate Enrolled Act One's impact. That's kind of a broad statement, but uh we'll we'll we'll let you uh get into the details. >> Perfect. Thank you. Well said. Awesome. Appreciate the opportunity to be here with the uh board this evening. Uh I think it was back in March, Policy Alex was here uh presenting to the board as well. And uh again, uh Policy Analytics is based out of Indianapolis. Um and we specialize in um financial analysis for

002government units such as schools, cities, and towns. And today here we're to talk about Senate and Rolled Act One uh which is the result of legislation that was uh passed by uh the legislative body on April 15th and signed into law by Governor Bronn and really has quite a bit of impact when it comes to our property tax related funds uh specifically the debt service and the operations fund and uh we're going to walk through those tonight. Um, you know, it is really a complete rewrite of our property tax system in terms of the way taxes uh interact and revenues interact with uh school districts. And so um start here tonight policy analytics. Uh we're working with roughly about 80 districts across the state, school districts across the state um and working to understand these

003impacts. And three real um main points that have started to come to the forefront uh have been Senate ruled acts one impact on tax rates and what is going to do for tax rates not only for school districts but other governmental units, the impact it may have on levies or the revenues that are generated by the school district and then potentially the impact on taxpayers and what we may see. And the analysis is based off of what we know today uh in terms of what's come out of the legislative body here this this past spring. And it starts really with the base understanding uh I guess of how property tax revenue is generated. And we start with a simple calculation which is net assessed value which is the assessed value. It's the value of all

004the properties, the homes, the businesses, uh, across Elcart Community Schools after any deductions they receive. That's what we refer to as net assessed value times a tax rate generates the revenue. And we've been living in this world where assessed value has been going up. If we think of really primarily driven by home prices and we talked a little bit about that this past spring was as home prices have riven risen across the country and across the state assessed value has gone up and and the schools have seen that and when assessed value goes up uh one if I have a steady tax rate it's going to generate additional revenue or I have the ability to potentially lower that tax rate and generate the revenues needed when I have a growing net assessed Senate enrolled act

005one really flips the script in that regard in that it is going to cause really a decline a potential decline in net assessed value over the next several years. And as assessed value goes down the mechanics are it has the potential to drive up tax rates and impact the revenues. And that's really what we're going to highlight tonight in the legislation. And so this is really a systematic change uh for government units when we look at Senate Enrolled Act One. Why and how? So, the legislation made a number of changes for different groups. Uh the first being homeowners. And if you've ever paid attention to your property tax bill, uh it starts with a gross assessed value, which is correlated and and and relative to market value, what you could sell your home for theoretically.

006And that is the gross assessed value. And then they we've had deductions of a standard deduction of 48,000 and a supplemental deduction of 35% is what we've had in place. The legislative body made changes as you can see outlined on this chart that phase out the standard deduction over the next six years and increase the supplemental deduction from 35% up to 66% basically 2/3. Part of that reason is that a $48,000 deduction is a flat deduction and theoretically becomes worth less as a deduction as my home value goes up because it stays stagnant during those times. Where if I have a percentage deduction of the overall assessed value, as my home value goes up, so does that deduction. And that was really the drive from the legislative body. What this really does at the end

007of the day if we try to translate that is it grants a larger deduction for homeowners. Okay? So it's going to increase the deduction of homeowners. And really the big broad theme we're going to talk tonight is as we increase deductions we drive down net assessed value and that's going to have impact on rates and revenues. And that's our big kind of broad stroke. And so we see that first for homeowners uh here in this slide. The second piece they did for homeowners was to enact a new homestead credit. So starting in 2026, uh a homeowner would receive an additional 10% up to $300 on the their tax liabilities we call or what they actually pay in terms of property taxes. So, if I have a home worth $200,000 and I pay 2,000 in property

008taxes because that's my 1% cap according to state law, I'm going to receive an additional $200 off my property tax bill and only pay $1,800. The $200 that's not now paid by that homeowner is going to be revenue that's not collected by the local units of government, including the schools. So, this is a change that we're going to see play out in terms of revenue uh because of this additional credit uh played. They also made some minor changes to some credits that have been in place for over 65 disability uh veterans. They've increased those credits and uh also increased the income eligibility to extend those credits a little further for those groups. Uh at the end of the day, trying to give some um property tax relief for homeowners. and and that was really the

009the goal of the legislation was to create uh property tax relief for homeowners uh in the state. Additionally, they introduced deductions for what we say refer to as our 2% property tax class. That includes things like apartments, long-term care facilities, and agriculture. And these groups have not had deductions in the past. And so this is a new deduction for the this group. And as you can see on the bottom left hand side there, the deductions again phase in over the next six years. And so as we look at all this legislation, we're really building towards 2031 when deductions are fully in place. Uh and again, the broad stroke here, we're increasing or introducing deductions. And as we bring additional deductions, we're going to drive down the net assessed value for the school district to have

010impact on rates and revenues. The last piece of change, it's probably the most complex. Um, not that any of the things we've been talking about are all that simple to begin with. Um, is business personal property. Business personal property is the equipment inside or associated with a business. So I often say if you think of a data center we hear of it's the servers inside of it or a farm you might think of a combine right it's the equipment that's used to uh operate the business and there has been in place what they've called a dimminimous amount of up to $80,000 that a business did not have to report equipment for state taxable purposes. So, if I had a $75,000 piece of equipment, I don't have to report that for taxes, right? It's tax exempt.

011That dimminimous amount changes from $80,000 in 2027 to $2 million. So now, if I have a $1.8 million piece of equipment, I no longer have to report that for taxable purposes at the state level. What that in essence does is pulls assessed value out of the system. And we'll see that in the data. And that does have impact here in the Elcart school district in terms of your assess value composition in the business personal property and that again will have some impact. The second component of the business personal property is currently a business has the ability to depreciate a piece of equipment down to a 30% floor. Uh so for easy math terms, if I have a $10 million piece of equipment, I can depreciate it down to $3 million. I pay taxes on the

012$3 million of that piece of equipment. Moving forward, starting January 1, that 3 million $10 million piece of equipment can actually be depreciated down to zero for t taxable purpose at the state level and really relieving some tax liability for that business. And so there's some potential long-term for an economic incentive for a business to purchase new equipment replacing old, knowing they'll be able to depreciate it further and generate tax savings or create a new entity to lease or shift that business personal property to and again depreciate that down. And so we know there's some short-term impact that we're able to model out. The longer term impact I think remains to be seen uh of what that looks like for um the business personal property that's above the $2 million figure. But you know for

013all intents of purposes if you look at this as a long range period over the next 20 years it really begins to phase out business personal property as a taxable piece in the state of Indiana. Um and so it that causes shifts at the end of the day in terms of tax who pays where those revenues come from. Uh the last kind of statewide piece and this starts to touch a little bit of the district though your debt service rate has been well below this threshold uh is a excuse me two debt service rate thresholds that determine how you have to operate uh in terms of projects. Um the district's rates right now is around 28 cents. So really uh the focus is around the 40 cent threshold. But just to clarify, there's been a

014legislation that if your debt service rate was above 80 cents, you had to take any project to a referendum, to a capital referendum. Didn't mind if it was $2 million or $200 million. And then if you're above 40 cents, it required you to do additional hearings. Um, you did not have to take it to a referendum. It could be uh in that situation, but requires a few more legal steps really at the end of the day. Why has this become a little more relevant for the school district is we've created a system that when net assessed value goes down, tax rates will be driven up and it could just put the district in a situation where the 40 cent may force the districts to to operate just a little differently in terms of those projects.

015Um so again not a I call it major concern for the school district in regards to this but just something for the district to be aware of at the end of the day uh because of the changing mechanics. Okay. Talk a little bit about Elcart uh community schools data. Um this looks at the net assessed value composition. This is after deductions. This is what we tax on. This is what generates revenues uh at the end of the day and determines tax rates. And overall the district has a fairly diverse uh pie as we call it. And you look on the left hand side um between residential. Anytime we have a solid base of commercial and industrial, we're tapping into the one, two, and 3% tax categories which allow that diversification to help generate some revenues.

016When we look at 2026, there's not a whole lot of change, right? The change for the district in 2026 is that 10% liability credit and that we're going to model out in just a little bit. When you look at 2031 when the deductions and everything are fully in place, the biggest piece to call out is the change in the personal or the yellow and that's the business personal property. And that really actually happens in 2027 if we had that pie. And that is when we exclude any business personal property parcels under $2 million. We're pulling those out. We're pulling that assessed value out. And that is why that piece of the pie gets smaller. And at the end of the day, like I sometimes like to kind of clarify is if this pie represents a

017$100 in 2025 and those are the dollar figures each of those groups are bringing. When we look at 2031 and the personal property gets smaller, it doesn't change that the pies maybe still $100. It just changes that the others potentially have to bring more to the table. And so it shifts the tax burden and who pays taxes and also can create additional circuit breaker um for districts in terms of revenue impact. And that's one of the things that we see here for Elcart Community Schools is the pie gets smaller a little bit. It shifts and it creates impact on revenues at the end of the day because of that change. Uh we're going to talk really two scenarios here and these are really just placeholders as we're trying to obviously model this out for uh

018districts across the state. Debt service can have some impact on your revenues in the operations fund. And so we've modeled these really in two ways. One of those is holding your 2025 debt service levy or revenue as we call it constant moving forward. And the other is to say if we are operating in the old model and you had your 28 cent debt service rate as assessed value grew it would generate additional revenue or levies. And you can see there on the the rate situation the levies get higher. And as those rates get higher it can have impact excuse me those levies get higher it can have impact on the operations fund revenue. And so we just want to model this out in in a couple of ways as assessed value comes out this fall

019here in just a couple of months. That's when we'll fine-tune this to uh some of your more specific scenarios uh as we model that for the district. But just wanted to highlight that when you see we talk levy and rate what those mean and what we're referring to. This is the chart that really is defining what we're seeing in terms of impact. This is our net assessed value projections for the district. The green line is gross assessed value and that is before any deductions. Um again that is a marketbased that's defined by a Supreme Court case that did not change in the legislation. Uh and so as assessed value has worked overall in the past it will continue to do so in the future and as you see that green line continues to grow in

020future years and that is because of policy analytics. We investigate economic data around housing, around commercial sectors, and right now there's nothing in the economic data that tells us that assessed value would not continue to grow. That a home value, gross assessed value wouldn't maybe move from 170,000 to 180,000 to 190,000 in future years. And so we have approximately about 3% on average trending AV growth in future years. And so that's why that bar continues to to go up. I do want to highlight um and I don't have the pointer within this piece, but if you look between the 26 and the 27year on the green line, there's a spot where the chart kind of flattens out and the assessed value goes from 8 billion 373 to 8 billion 333. So, it goes down just

021slightly. Well, why is it going down in that year when every other year it's it's trending up? That is because in 2027 the business personal property changes and we pull out any of those parcels under $2 million and that has an impact. It flat lines your AV during that year, right? In that piece. And so we see that business personal property having an impact on your overall assessed value. The blue line represents net assessed value. So that's after deductions prior to Senate and RO act one. And then the orange line represents our projections of your net assessed value uh after Senate enrolled act one. And this is where we see assessed value declining over the next six years until 2031. In 2031, all the deductions are fully in place. And so we see it start

022to rise. It's more muted. It's not as large of growth as the green line because of those additional deductions, but it starts to trend a little bit more like the gross assessed value. And so we've got this piece of a six-year decline in net assessed value and then potential return to some growth in that. Um, and this again declining net assessed value is going to have impact on rates and revenues. And depending on how this chart flows, again these are projections. If assessed value comes in better than what is projected, it's going to be more positive for the district. If assessed value comes in less because we see a pullback in the housing market or a plateau in the housing market, these could look obviously worse at some point. And so again, best estimates as

023we stand today in terms of growth. But what that means is we start to look at a situation that tax rates are one of the first places we will see some impact for the district. So this is looking at the district's total uh tax uh tax rate between the uh debt service and the operations fund uh currently at the 9197. And you can see it growing depending on um the debt service whether the levy or the rate depending on where you settle in on your debt uh levies each year. The solid lines are post Senate enrolled act one. The dotted lines are pre Senate enrolled act one. And so we see the potential over the next six years of anywhere from a 30 to 40 cent increase in the overall tax rate. I will tell

024you this is not different from the 80 other districts that we're running this information for. Okay? This is what we're seeing statewide for all school districts. the decline in net assessed value, the mechanics of the bill drive up rates in order to generate those revenues that the district has had in the past. And I think that's the challenge is the district's not necessarily increasing revenues, but the tax rates going up, right? The county will see a similar chart. cities and towns will see similar charts because again as you decrease the net assessed value you drive up the overall tax rate, right? And on average we're seeing for schools anywhere from a 30 to 50 cent increase over the next six years, right? It's not an overnight switch. It's a gradual piece, but we do see

025that driven up. And if you've heard Chairman Thompson speak, uh Chairman Thompson um is the chairman of House Ways and Means uh for the Indian House of Representatives. They've talked about moving overall tax rates between the school, the county, and the city or town up to a $3 kind of level overall. And so if you hear them talk, there was the intention that tax rates would drive up because they believe at the end of the day it creates a system of really, how's the best way to describe this? um individual units levies are really set um and the taxpayers uh would see some initial relief at the end of the day from that. Uh so we know that rates were intended to be driven up as we've heard from the author of of the legislation.

026We also see this again in the debt service rate. So that current 29 cent if you want to call it debt service rate um even if you keep your debt service levies the same uh would increase slightly um again you could if depending on the rate move close to that 40 cents in that threshold though it takes some time and again I think those are that's years off but we see this both in the debt service and primarily a lot of this is being driven in the operations fund um and so that's where we're seeing A lot of the rate growth is not really in your debt service that you do have a little more control. It's really driven in the operations fund and the mechanics of the bill. So what's that mean then I

027guess next in terms of revenues for the school district? And so this chart is looking at the operations fund net levy. So net revenues at the end of the day u in that levy situation. And so you could see in 2025 it's approximately 23.2 million. The dotted line is where we would have expected revenue growth prior to Senate enrolled act one. Um and so again we would have seen some growth in that overall figure. As you look at the revenue of the solid line post Senate enrolled act one from 25 to 26. It's relatively flat. Really no increase in revenue in the 26 operations fund. And that's really driven by that 10% credit. Okay, that that $200 I mentioned earlier that homeowner is not paying on their their bill now because that credit uh is

028revenue that the district's not going to collect and that's why it's flatlined there. From 26 to 27, you have what we call the pension bonds roll off. The pension bonds were established years ago uh for school districts across the state um because many districts had what we determined unfunded liabilities in terms of um retirement type benefits, right? Pension type benefits. And the state uh forced school districts at the time to take out bonds to back those um obligations and could pay those off over time, but it actually comes out of your operations fund. So, it wasn't new money that the districts were able to actually access. You subtracted it out of your operations fund. Those expire in 26. They're paid off in 26. So, that money now flows back into the operations fund that was

029being used to pay off those pension bonds. And so that's why you see that spike and increase in 20 from 26 to 27 because of the pension bonds being paid off and the operations fund dollars uh or the operations fund seeing those dollars roll in. And then we see a little bit of a decline from 27 to 28. And that is because um there is a property tax replacement credit that is funded at the county level through local income taxes. It's a mouthful to say uh in that piece. A lot to comprehend, right? So, what's that mean? Local income tax. So, the county has an income tax that they take from residents within the county. That revenue comes in and they disperse it out in different ways. One of those being a credit on the

030property tax bill to try to lower the impact overall of property taxes. Because your residents are at the cap, it's really then used to actually support revenue for the local units in lie of those caps and that is scheduled to go away in 2027 due to the legislation. The current local income tax agreements go away in 27. So the property tax replacement credit goes away in 2027 and the revenue drops for the district in 27 from 27 to 28. So, we've got this bit of a a roller coaster in actual revenues that we're going to see. But I also think the piece to point out here is you can see the gap um continue to grow between the dotted line and the solid line between revenues we would have projected the district to receive to

031what we now project them project the district to receive after Senate enrolled act one. Right. and to you see it culminate in 2031 of about a $5 million change from the baseline in terms of revenue on an annual basis. Right? So a significant hit when it comes to the revenue in lie of Senate enrolled act one and so again impact on the operations fund as we start. Uh but the legislative body wasn't done um and they included some additional pieces. This is that postcircuit breaker credit or the 10% um liability credit. And these are the dollar figures that represents, right? So I take that $200 and when I aggregate or aggregate that across the entire community, it ends up being in totality about $1.2 million of revenue that the school district won't receive because all

032that homeowner relief. Most of that impact falls in the blue on the operations fund and that is actually already modeled out as I noted in that previous slide. Right? I showed that the 26 revenue and that moving forward is stunted because of that 800,000 and revenue not being received due to this credit. The challenge is there's another 400,000 that hits your debt service fund because the debt service fund is not protected from this impact. And so theoretically, what that looks like is that in 2026, if you had a $14 million levy in your debt service fund, you would only receive $13.6 million. So you'd be short $400,000. You need that $ 14 million though to pay your debt payments. So where does that shortfall come from? Any cash balance you have in the debt service

033fund. What happens when you run out of cash balance in the debt service fund after several years? Then you have your re rainy day you have to use or your operations fund. We believe that the legislative body is going to change this because it could potentially at the end of the day cause school districts to default on debt payments because of their particular situations. And I don't we don't believe that the state is going to want the legislation to cause defaults on debt payments or downgrades in ratings from S&P or Moody's uh at the end of the day. And so we feel they will make a move similar to they do to current circuit breaker which is called protect the debt service fund. So what's that mean? It means that that impact of that $400,000

034would no longer hit the debt service fund and you would get your full amount in the debt service fund. But that orange would now turn to blue and impact the operations fund and be revenue you would not collect in the operations fund. And so as we revisit this chart, that maroon line now looks at your revenue between in the operations fund and says in 2026, if they make this change, starting in 27, you would receive about $400,000 less in the operations fund and just another impact to the operations fund in terms of overall levy. Right? So again now when we look at this potentially you know uh in totality between that it comes to again a fairly significant impact and gap in what we expected in terms of revenue and what you're receiving in revenue

035and and you fall into this category that we heard about from the legislative body which was districts were not going to receive less you're going to receive less of more. So instead of receiving the solid line or excuse me the dotted line, you're still going to have more revenue than you have in 25, just not as much as what you would have received, right? And that was kind of what they spoke to. And for majority of districts, that's the case. There's about 74 districts that actually received fewer dollars in 26 uh than in 2025 and 85 districts that received fewer dollars in 2028 than in 2025. Right? So it varies across the state. Um but this is what they stated, right? And I think the challenge is you now have a 2% 1 to 2%

036annual growth in your operations fund versus a closer to 4% growth when we know we have cost in the operations fund that we don't control. Utilities, for example, all three major uh utility companies across the state have passed either last year andor planning again this year. Rate increases. The district absorbs those. Property and casualty insurance, transportation, all those costs continue to have increases and it's going to be faced now with more muted revenues at the end of the day uh for the district. And so this is again um was the intention I would say of this bill was that was felt that uh districts had enough dollars in their operations fund and could survive with a chart that looks something like this right um at the end of the day. Um and so we do

037see impact when it comes to the overall really revenue stream for the the district. Let's talk a little bit about taxpayer. Um we have looked at this uh from the taxpayer perspective really with the question um did the legislation do what it it intended and we take that intention thinking that it was to create historic property tax relief or property tax relief for homeowners. Right? And the question reason we asked that is because if it did not do that maybe to the level that was intended are we done with this legislation or not? Okay. And I'll reference that the bill was signed as I mentioned uh into law on April 15th by the governor and 8 days later a bill was passed with amendments to Senate Bill 1 because it was moved very quickly through

038both the house and the senate. And so there is an element that um a lot of things were passed maybe not knowing the full impact at the end of the day, right? or run at a statewide level impact that tells one thing but looks very different when we localize it to the individual districts and I think we're seeing that in the in the data at the end of the day but to speak to the taxpayer impact and I know you have more than one taxing district so this is a simple just illustration um so tax liability again we're talking the amount of property taxes that the taxpayer would pay and in this case all of the homesteads within this taxing districts are at the caps, meaning they're paying the 1% max that they they can

039on their um tax bill. And you can see from 25 to 26 that um liability does go down. Why does it go down? It's because that homeowner is now receiving a 10% liability credit that was passed into law as part of the legislation. So it is going to drive down u the tax bill. However, if we look at that a little more closely, it would theoretically say that that taxpayer should receive $187 of credit. First of all, that's not $300. And I think that's one piece that people maybe hear is 10% or $300. They hear $300. It's 10% of what you're paying. So, it's most cases not going to be the full $300. And in all actuality, if you look at it in 26, we're projecting that it's closer to $130. Why is it not

040the full amount? Well, as my gross assessed value continues to grow the next year, so does my liability and it eats into that credit that I would have expected to see. And so we think this is going to be an interesting piece I think in terms of how this plays out because if assessed value is even greater than what we have in our projections that $130 may be only $100 or $80 and people may be expecting one thing in terms of a credit and not seeing that actually play out when they see their tax bill. And so we think that's one thing that maybe uh tells us that the legislation didn't do what it intended. The other is when you look in the years after that, we see the tax liability continuing to increase. That's

041again as the gross assessed value of the home increases, so does the overall liability. And we really kind of move back to the system that we've had where each year property tax bills have gone up. And it's not as much as maybe we've seen in the past because of the deductions, but it's definitely a potential for increasing tax bills. And so again, um, we just wonder, at least from our perspective, of is this what was intended to happen? Is it what was expected to happen? And if not, what does that mean for the 2026 legislative session? Does that mean they're done tweaking this bill? Um, I think there's we're hearing rumblings that there's already property tax um, reform phase two that may be coming in 2026. Um I don't know if that's good, bad or

042indifferent, right? I think uh that's localized to each community. Um but I do think there is some things that they're not done yet. I think is what I think we would interpret with this, right? Is that there's some things pointing that they're not done. And so you know, I think at the end of the day, um you know, one of the things we've looked at for the district is this does have revenue impact. Um, you know, so we have been modeling the cash flow for the the school district. Uh, and as we look at pre-enate enrolled act one and we look then at after Senate enrolled act one, we see really revenues go down and revenues just increase the gap in terms of surplus deficit because we've not had a chance to adjust expenditures, right?

043And I think that's going to be one of the discussions uh for school districts across the state is they're facing lower or muted revenues than projected. And we have places where we don't control expenses or we're facing $45,000 minimum teacher salaries, 65% of our salaries going to salaries and benefits. some, you know, pressure from the state to continue to increase support and those don't align when you have muted revenues. And so, a lot of districts across the state are having some challenging conversations as a result of of Senate Enrolled Act One. Um, and really what it means for the school district at the end of the day. Um, and so more than happy to take any questions. Um, I know this is probably not the most positive news, uh, as maybe the understatement might say.

044Um, it's it's been a challenge obviously having these conversations with school districts because we're seeing this kind of impact and, um, it just it's a diver diverging from where we were, right? It's um, lower revenues than we expected, which is never a a real positive and it's going to force some additional conversations for school districts. Um, so, um, I think the challenge has been no one truly knew the impact. Uh, we had a legislative services report that came out, oh, I want to say roughly May that just didn't have an accurate, uh, description of what the impact was going to be. And so, districts are starting to see what this truly looks like. And it's, uh, definitely, I'd say, um, more impactful than maybe what was presented in that LSA report. And I think it's

045just now causing some conversations to begin to happen. So, um, with that, Dr. Huff, uh, members of the board, I'm more than happy to answer any questions. >> One, I want to thank you for your, um, in-depth presentation. I think this is clearly there's nothing good that came out of this this um, this um, this legislative cycle for for schools. But I do think with informed information we can make decisions and make them pretty early and we know that some of those decisions are going to be difficult. Can you kind of talk to our community about um one what is the total anticipated um reduction that we may receive as far as dollars over this? And then I want to also talk about 2028 why things change a little bit um for the school districts

046and on how we share our funds as well. Uh so in totality I I would have to go back and calculate this exactly within this piece because the gap does grow from what we would have expected you receive. Let me go back to this. Oh, I messed something up here. But I think I can maybe get there. >> Okay. This is why you don't let me run technology right at the end of the day. Um you know this is this is the gap that we're really looking at Dr. Huff. you know, and in uh really those last years, you start looking 2028 and beyond, it's about a $5 million annual impact, right? Just in those years, it's a little more narrow in 26 and 27. Um, you know, to the tune in 27, you're probably

047looking at about a $2.2 million differential. And in 2026, you know, it's probably closer to several hundred,000. So when you add that up, you're getting close to $20 million of impact really over the next, you know, five years w within that piece of what you would have expected in revenue to what you're receiving right at the end of the day. So um so a significant number obviously at the end of the the day. Um did you want me to address the 2028 in that piece as we more than happy to? So, uh what is also factored into these calculations that um I didn't highlight in the presentation was uh legislation that was passed um that creates uh sharing with charter schools uh really across the state. Um, two years ago, legislation was passed, um, for

048four counties as a pilot, uh, which we've seen has now open to the state, but for four counties to begin sharing operation fund dollars with charter schools. Uh, those four counties were Lake, Vanderber, St. Joseph's, and Marian. Uh, and so Evansville, Gary area, South Bend, and Indianapolis. And that's been in place. um though it was a smaller figure because it was based on what we call incremental growth. So if I had $4 million in operations fund and next year I had 4.2, I was sharing a part of that $200,000. The new legislation really changed it to it's a per student amount. So now I'm going to share all of that 4.2 2 million during this time. And it starts in 2028 and it starts in as a 25% uh share in 2028, moves to 50%

049in 29, then to 75% and then to 100%. And really, it's based on uh you having at least 2% of your enrollment or 100 students attending a charter school. Doesn't matter if it's in the county, doesn't matter if it's in your boundaries, doesn't matter if it's a hundred charter schools that those hundred students go to. It is a hundred students regardless of where they go um that you'll begin sharing. And so, uh I apologize Dr. Dr. Off the top of my head. I'm not sure that exact number of the charters, but we do have that factored in which is part of that growing gap that we see. >> I think we send um to four different um entities. So, I wanted to make sure that that that was a part of a conversation that we

050need to plan for as we move forward as well, knowing that now school choice is being pushed out into the world. And there's micro schools, there's all these different types of school environments where families can choose to go. It's it's imperative that we explain to our community and we have to show why Elkcart is a value for our families. So 92% of people still currently choose public schools and I believe that we provide an excellent service for them. But I think it's more important that we tell this story of all those things that we provide for our families because I don't think the average taxpayer and family understands what is happening or what is going to happen and the I'm going to use the word kind of um it may be hyperbolic but I believe

051the destruction that we're going to do to public schools based off what's happening here. Um and this is just not at the state level the federal level as well. So I wanted to make sure that we had a presentation to kind of set the baseline of this is not in happening in a few years. This this starts right now when it comes towards we have to start thinking differently about how we um view school funding. Um, so again, I guess that wasn't a question. That was more of more a diet tribe, but um that $20 million that hurts over the next four years and and Oh, so that was it. That was my part question, part dialogue. >> Any other questions from the board? those I know I always say this uh we we've been

052at this since 3:30. So we had a lot of our questions uh asked and and and answered uh prior to uh um this work session. So no further questions. Thank you very much. Very informative. Yep. Thank you. Thank you. All right. Um, I will now we'll now recess the uh public work session and reconvene at 7:00 for our normal board meeting. Thank you. No, I know. He does distinguish. Thank you everybody for uh coming out tonight for our July 22nd, 2025 Elcart Community Schools board meeting. At this time, I'd like to call the meeting to order. And if you could please rise for the pledge of allegiance. Next on the agenda, we have the Elcart Promise. Mr. Bernett, >> the Elcart Promise. Every student is known by name, challenged, and supported by highly effective staff

053and in partnership with the community will graduate college, career ready, and life ready. >> Thank you, Mike. Dora, do we have We don't have any. So, I will not go over the invitation to speak protocol as we have not had anybody turn in um their slips to speak tonight. And so, we will move past uh public comment and um come to one of the the things I uh enjoy is our moment of pride, Oak High School Unified Track. We got we got right to it. Yeah. Sorry. Yeah. Yeah. I know. [Applause] Oh yeah, look at that. [Applause] only uh only got one of the trophies. You >> the other one's pretty high up in the ceiling. We could not get get it down. So, I apologize for that. >> But there is another one. >>

054There is another one. Yes, that is correct. So, um thank you again everybody for allowing us to be here tonight. Um I'd say this gets old, but this does not uh whatsoever. Um, I want to thank our school administration. Um, I'd like to thank our athletic department. I know both athletic directors here tonight. I want to make sure we thank our booster club, our bus driver who took us to state and back. She was awesome. I have a shirt for her whenever we get back into school. Um, our team parents, fellow teachers, and staff for all their support throughout the year. Um, thank you to my coaches. I often say this, I am not the easiest person to work for and with. uh maybe it's my level of expectations or just whatever else, but thank

055you uh to them. Um I'd like to thank the school board uh for allowing us to be here tonight. Elcart communications department for all the different articles. When WNDU came, you all were there. Um I'd like to thank the school administration superintendent. Um and then I'd also like to take this opportunity to thank Dr. Huff. And then our two captains for the season, Mia and Brennan. Would like to present Dr. Huff with a state championship medal, a baton along with a state championship shirt. So, thank you very much. >> No, you keep yours on, buddy. >> Shirt on. >> I appreciate you. I may have other sizes in the vehicle. I was just >> Thank you very much. >> Thank you. >> Um once again, um thank you to everybody. Um so far, uh we

056have raised $4,300 towards our goal of $6,500, uh for state championship rings. So, if anyone listening at home or elsewhere feels inclined to help, uh feel free to reach out. Just real quick on our season, um last year I talked about the team being perfect. We didn't lose a meet all year. Um, while this team may not have been perfect consistently on the track, they were perfect together. Um, especially when it counted. Um, I don't also I want to take a second. I don't want anybody in the room ever take this for granted. Um, it's really easy to say, "Oh, you've won two backto-back. You've won three in eight years. All those are great accomplishments, but it doesn't mean it's always going to happen." Um, some people could say, "Well, it's easy to win a

057unified track state championship." And let me give you some numbers real fast. There are 32 6A football teams, meaning you only have to win five games to win a state title and beat 31 other teams. There are 100 4A basketball teams. There are 102 3A soccer teams. And there are 96 unified track teams. So while we say it's easy, it's really not. Um, a lot >> there be 95 that would say it's not. >> Yeah. So it's not. Thank you. Um, but I just never want us to take it for granted because while the program is backto back, there are some kids in this room right now that this is their first one. And so I appreciate them getting to be recognized tonight as well. That's very important. I'm going to call up really quick

058Hayden Dinhardt as I'd like to have her read something to everyone. >> So this is a poem called Our Deepest Fear by Marian Williamson. Our deepest fear is not what we are inadequate. Our deepest fear is what we are powerful beyond measure. It is our light, not our darkness, that most frightens us. Your playing small does not serve the world. There is nothing enlightened about shrinking so that others won't feel insecure around you. We are all meant to shine as children do. It's not just in some of us, it's in everyone. And as we let our own light shine, we unconsciously give other people permission to do the same. As we're liberated from our own fear, our presence automatically liberates others. [Applause] >> You may have heard that poem um from the movie Coach Carter

059um with Samuel Jackson. Very good movie if you haven't had a chance. And I asked Hayden to read that because as I was watching Coach Carter and thinking through that speech, I think about these student athletes, how they are the light, how they are the ones showing others in our school corporation, adults as well as other students, it's okay to sit with someone that you may not have sat with yesterday. It's okay to befriend someone that maybe you weren't friends with in middle school. And I think with our programs, we have our united groups at school, sound and theater. We have applied classes along with our unified sports. Um, we have students. How many of you volunteer down the intense intervention room at times? How many of you are going to go into education? How

060many of you are a better person because of this? All hands. We have non-verbal autistic students going to lunch with teammates now. That didn't happen a long time ago. We have students who go to graduation parties. Brennan, did you have fun at your graduation party? >> Yeah. >> Was there a lot of people there? >> Yeah. >> Right. But that's what this is about. And I just want to thank the student athletes because without them, we're not as successful as people as we are. And I think once they embrace the light that they can shine, um they will be able to show others as they advocate throughout their lives those that are leaving Elcart, they can champion the inclusion revolution cause and we can continue to make Elcart a destination for athletics, but the place

061where inclusion starts and ends uh is with us in Elcart. Um, I want to thank everybody again and I leave you with we are all better together and we were better together this season and I continue to say this, light up Lions. Thank you very much everybody. I appreciate it. Hey guys and gals, if you'll come behind this way, we can get a quick photo. >> Also, if any schoolboard members would like, we do have Samantha has posters from our celebration night that if anybody was unable to get one, we have some that we can get you one. Okay. I'll get the center. Let me get out of the way. >> We got to stand together everybody. Put the camera in the middle. >> Okay. >> All right. Make sure say thank you and you

062team members will meet outside. Okay. Thank you. >> Thank you. I got one and sign. >> It is very heavy. I'm not tell you this. >> All right. Thank you guys. >> Thank you. [Music] >> All right. after uh I would kind of always like to end there, but uh we're actually uh going to move on to something as as as equally as uh uh gratifying as the ex excellence card. Wendy, >> thank you. President Scott, members of the board, Dr. Huff community members. I'm grateful for the opportunity to share highlights in the areas of academics, arts, and athletics. For academics, representing eight different Elkcart Area Career Center programs, 14 of our outstanding students brought their talents to Atlanta, Georgia to compete in the 2025 Skills USA National Leadership and Skills Conference. Four placed in

063the top 10 natural nationally with one earning a third place finish. Elcart Community Schools partners with Tulsen Center for Summer Explorers, Adventures, and Health Sciences, offering rising middle schoolers hands-on experiences through the Elcart Area Career Center. Students learn CPR as part of the engaging summer program for arts. Several Elcart High School students performed in Indianapolis as members of the Indiana Allstate Jazz Choir. Selected through a competitive audition process, they represented our district with excellence and showcased the strength of our music program. And it's marching band time again. Percussion instruments and students perfecting their marching can be found across the high school campus and preparations for the seasons get underway. Beginning band and orchestra students are also working hard developing their skills for the year ahead. For athletics, Elkcart High School football recently ski scrimmaged two

064of the state's top programs, Hamilton Southeastern and Zansville at Indiana Westland University. Our athlet athletics held their own and caught the attention of IWU coaches. Beyond the competition, students had the opportunity to tour the campus and unwind at the pool. Elcart High School athletics continues to show excellence through growth and opportunity with the exciting launch of girls flag football. The team recently held its first ever practice, marking a historic moment and expanding the athletic options for students. For our future happenings, July 25th is our first annual Elcart football night. August 14th will be our first day of school. And as always, please be sure to follow the district and social media pages as we share each day the excellence of Elcart schools. >> Thank you, Wendy. >> Job well done. We actually had to write

065pictures this time. >> Yeah. Makes it a little easier, huh? >> Yes, it does. >> Great job as usual. Uh next on the agenda, we have uh policy uh policy analytics uh to discuss the school year expenditure review. Thank you, Mr. President. Um, Dr. Huff, members of the board, uh, Barry Gardner with Policy Analytics. Uh, Policy Analytics, uh, is based in Indianapolis and works with a variety of government units across the state, including schools. And I have the privilege of leading the the schools division. Uh, we work with, again, a little over 80 districts across the state. Um just briefly uh a little bit myself uh prior to joining policy analytics I spent 23 years in public education uh as an educator uh athletic director administrator and then spent the last eight years uh in

066school finance as the chief financial officer at uh Brownsburg Community Schools and then the assistant superintendent for finance and operations at the MSD of Wayne Township on the west side of Indianapolis. And so, um, we help districts understand their financial, uh, picture and what, uh, is driving that, uh, and helping them tell their story. And the district had asked for policy analytics to do a bit of a deep dive into, uh, the financial history, um, as we look at the the school district's expenditures and and revenues. Um, and as always, I feel like in my career, I always have the fun of getting to follow things like the unified track, uh, with all these great, you know, stories and accomplishments, and then we get to talk about school finance that everybody loves, right? And so,

067um, want to just take the opportunity, you know, to to walk through this tonight, uh, really at a high level. We can spend a lot of time digging in the weeds of school finance, but tonight is really just to show some some broad pieces that we're seeing. Um, and I I think the blunt piece to really start to look at is some of the challenges the district is beginning to face. Um, you know, as we look at their financial picture kind of moving forward and it's the result of some things many districts across the state have faced. Um, there's been declining enrollment uh for the school district. And I think one of the pieces that we have to remember is that uh in our state funding system, dollars follow the students. Uh you know, we

068have a per student dollar figure that um we do our enrollment counts in the fall and the spring and based on the number of students that we have, we receive that revenue. And so when the number of students go down, so does the revenue that comes to the school district. And that's been one of the challenges as the district has seen some decline in enrollment. uh and again then facing a time where there's always the desire for additional support for students, right? And how do we best serve students and how do we model that out? And so tonight we're going to take a look a little bit at what we've seen in terms of some of those changing expenditures uh versus some of the revenues that the district has seen. And um so start oh

069if I can take here uh so again some real high level pieces uh as we look at school year to school year changes and really we're highlighting the last couple of years um school year 21 to 22 to compare to school year 23 24 and and part of that uh really look is when we get back into the 1920 school year and to 2021. As much as we don't like to think about it, we have to remember that was COVID and there were a lot of moving parts that imple, you know, impacted some of our funding as a result of of COVID. And so to try to have some, you know, apples to apples comparisons, we we really looked at these two years and we start with some of the big buckets within school uh

070funding. So general education is your classroom expenditures, see special education down to what we see in the operations fund. and really want to focus on the right hand side of the column as we look and compare the percentage changes really over the two years in some of these areas from an expenditure standpoint. And I think first to baseline this a little bit is we're always going to expect more than likely some expenditure increases potentially year-over-year. Uh we have inflation, right, that we've seen dramatically over the last several years. So we're going to expect, you know, costs to go up. uh schools have battled uh and faced a challenge of classified staff as we saw the private sector increasing their wages and schools had to react to those pieces. And so there's obviously economic factors both

071outside of school as well that that that we face. But when we think of that, we're going to one typically see something in a 3 to 5% kind of annual increase as a normal situation, which is we look over a 2-year period would be in a 6 to 10% rough piece. And as we look at these changes here, we see obviously some much larger percentage increases than a 6 to 10% rough baseline that we might expect over a two-year period. Um, you know, one that stands out, uh, is special education. Now, I will tell you, uh, special education is a cost we're seeing rise across all school districts. Students continue to have needs, uh, and that obviously drives staffing, uh, for those needs to support those students. And as we continue to identify students that

072have needs for additional supports, those costs have gone up. Uh the challenge is while we're supporting those students with those additional cost is they begin to take up a bigger piece of the pie, right? As we talk about a finite amount of dollars. And so that's one of the challenges that that we face uh within that. But we see there's no one single area. It's been driven across many of these different areas in terms of these buckets that include salaries and benefits as well as operational cost. And I think the biggest piece is when we step back and we look at the total expenditures versus revenues over this 2-year period is we saw an increase of expenses of 18% and revenues only increased by 5%. And again, part of that drag on revenue is the

073change in enrollment. And as students have declined in terms of enrollment, so have the dollars coming into that education fund specifically within those pieces. And I think anyone would expect a recipe for challenge would be when your expenses are outpacing your revenues, especially to a degree of this. And the further challenges we'll talk more towards the end is these compound, right? And they continue to compound year-over-year uh especially when they're associated with staffing in terms of salaries uh or additional staff that we may have uh in the district. Uh and so again really I think the broad stroke here is that we're seeing this really across the board both educationally and operationally within the district uh with expenses outpacing revenues. when we start to drill down and this is one of the things we do

074at policy analytics is to say okay maybe what are some of the areas that start to stand out more than others when we look at now what we call the account level which starts to drill down maybe between again elementary or middle or high school um or as we see the 12,000 accounts there some of the special ed cost and again we see some large jumps especially in some of our specific special education costs that they've really doubled over the past couple of years. Um, and again, when we see milliondoll increases in that period of time versus revenues that aren't keeping pace, we're continuing to create pressure on our overall kind of structural balance for the school district. And again, then we see that play out really within both our maintenance of the buildings uh

075in our 27100, it's called vehicle operation. That's our transportation, that is our bus drivers, uh that is our our bus mechanics, it's the salary and benefits associated there. And again have seen a a large jump. So we know this is happening programmatically. We know this is happening across all of these areas. And even when we dig down deeper into some of the specific accounts, we see again on the right hand side some of these both larger than uh normal percentage increases and then we even see those nominal dollar figures increasing really over a two-year period um by million a million dollars or more in each individual account. Um, and so again, we start to then peel back some of the the layers here. And the next piece is to start to look at where are

076those being driven. And, you know, one of the pieces we see here pretty quickly is that salary and benefits are both up uh salaries are almost up 20% over that period. Uh, benefits are up almost 14%. And you know big picture-wise when we look at things like salary and benefits those are driven really by two pieces. how much are we paying and how many people are we paying really at the end of the day, right? And I think one of the challenges we would interpret in that is as we see that large of an increase in both the salary and benefits um knowing the data around enrollment, right? is there seems to be a misalignment in terms of those type of expenditure increases specific to salary and benefits that we would expect if we've got

077a declining enrollment. In a declining enrollment, we would expect some contraction. It doesn't mean necessarily that the salary and benefits line would go down, right? They may stay relatively level and have minimal increases because we're giving salary increases, but they are much more constrained because we are right sizing staff around that downsizing of enrollment. And I think our analysis within this is we are not seeing uh some of that um alignment between enrollment and maybe staffing uh that we would expect to see uh in a situation like this. I believe um in part of the analysis that uh it's roughly thou excuse me over a thousand students uh decline over the last several years in terms of enrollment and when again we think of eight or $9,000 per student we're talking 8 to9 million of

078revenue that is now not coming into the district right and again we think of a thousand less students we would start to expect to see some contraction in terms of staffing which would be reflected a little bit in the salary and benefits line uh within this. And so I think that's a piece that we would encourage the district to really look at staffing levels, staffing ratios both in certified and non-certified staff. Um because these are a combination of both the education fund and the operation fund. Um and so we would want to take a look at that deep dive in terms of staffing ratios on both of those funds across buildings to see again um is that ringing true? But that's at least I think our analysis and what we typically see in school districts

079is that if we see salary and benefits aligning and like that in terms of increases versus enrollment, we probably have some sort of staffing alignment that we need to at least evaluate at the end of the day. and and again that is sometimes tougher than others. Uh we often say if I lose 10 students across a district this size I may lose obviously quite a bit of revenue but it's hard to reduce staff when I lose 10 students. However, when we start getting into losing several hundred students that's when there's some opportunity I think to look at right sizing that staffing at the end of the day and those are obviously tough conversations. Uh but again we look at the fiscal health and that's a big piece of what's contributing to expenditures being at 18%.

080revenues only at that 5% uh at the end of the day. Uh when we dig down the other piece that we start to peel back again this onion just a little bit further um and we look at what we sometimes call the object codes which is just a more detailed analysis of some of these accounts between operations fund and education fund. Uh we see that this plays out both with certified and non-certified salaries. Uh again certified salaries are going to be primarily our teaching staff. Uh non-certified um you know are going to be pair professionals, uh bus drivers, maintenance workers and we see those increases really in both but especially in that non-certified area. Um and so again I think it would be some of the analysis of what supports or where those non-certified increases

081are coming from. And then the other area that stood out, you know, I would say inside of this is this area of other salaries or additional compensation. Um, you know, the other salaries portion is up a little over $2 million over the last two years. Uh, and the additional compensation is up approximately 1.2 2 million. And you can see the percentage pieces that is going to fall in really compensation outside of the typical job structure, whether that be through stipens um or additional pay for additional uh components. But there's obviously been an increase in uh this area of these stipens or additional compensation um outside of what I would would define inside the contract or the the payment structure that hourly wage maybe within the certified um and again I think an area that uh

082our analysis is not judging that that that's right or wrong. It's just pointing out that as we increase that, we obviously take up a bigger piece of the pie, which leaves fewer dollars for other areas. And as we look again back to that expense over revenue, those expenses are outpacing the revenues that we're receiving. And so, as we think about how we manage the school financial situation long term, we have to balance expenses against revenues. Uh and when those are out of alignment, we start to create more difficult financial challenges um for school districts. And uh and again, so we see again whether that's education fund or uh the operations fund, we actually see some larger non-certified increases in the operations fund. Uh and again some of that to be perfectly uh transparent I think

083has been driven the last several years by uh competition with private sector right we've had to increase salaries with non-certified whether it be pair professionals whether it be bus drivers in order to compete with the private sector um unfortunately private sector has the ability oftentimes to raise prices or raise revenues where we do not have as school districts control over our revenues. Um, you know, it's really that enrollmentbased uh piece within that. Uh, and so again, I think those were uh a couple areas that that really stood out, though we again just see larger than I would say expected increases really across the board. Um, whether it's the education fund or the operations fund at the end of end of the day, but these are definitely areas that are driving this. Um and you know

084this chart really just types to attempts to put a little bit of a visual to what we have seen over the last really two years of a situation that there was some balance um you know 202122 uh in terms of revenue and expenses. Now again we get into that time period it's gets complicated because again there was co there was esser funding that was coming in during that time that created some support in some cases a little bit of false support um you know having lived that in my time at MSD Wayne there was a lot of dollars that came in um that really could help bandaid right uh some situations in terms of some funding uh so that also would create some question in our mind of truly that accuracy of that revenue venue

085versus expenditure surplus uh in 21 and 22 of how much that was supported through things like ESSER. But you can see very quickly from 22 to 23 and 23 to 24 the rise of the expenditure of the TL line uh versus the um rise in revenues. And again, these tend to compound. And as we create this gap and then we start to look at what does this look like in a future sense, we're creating a structural imbalance at the end of the day where expenditures outpace revenues. Um, and as we look at this um kind of page here, and this is a summary page. This is looking at also taking into account Senate Enrolled Act One. Here we're just looking at all the revenues that are coming into the district versus the expenses uh and

086the surplus uh deficit uh line there. And you can see over the last couple of years, this is a calendar year look versus a school year look. So there's a little bit of of difference uh in these figures uh in full transparency, but they play out over time. Uh and what we see is a growing deficit uh year-over-year and a projected continual because again as of right now without changes to the current expenditure structure knowing that revenues are going to continue to be muted due to Senate enrolled act one expenses are going to continue to outpace and we have in this projection um continued increases for salaries and benefits um and so again we're compounding that a little bit uh in terms of that. But obviously that's always the goal of a district and that's

087how we build that, right? Is our goal is to try to give increases in salary and benefits u on an annual basis. But we see that widening gap in terms of that surplus deficit uh and to the point where the district's going to face a cash balance situation uh and and fairly quickly. And it's something that's obviously spurred um as you could see in the previous charts uh in a pretty quick fashion. At least it looks like on paper, right? And that's where I question a little bit of the time during the ESSER and the COVID period that some of it was overshadowed by those additional federal funds that came in. Uh and Elcart schools would not be alone in that. Again, working with a lot of districts across the state. Uh ESSER um kind

088of created a band-aid on some things that allowed districts to to kind of continue. And then also we saw programs and pieces that we liked and tried to continue and support students and yet didn't necessarily have the funds to support those as ESSER went away. Right? And I think that's some of the things we see with school districts across the state is that mirage really that ESSER funding created um that we we saw on those charts. And so you know I think at the end of the day what we're seeing is not a sustainable situation. All right. we have a structural imbalance in which expenses are outpacing revenues to a pretty significant level. Um we see that those are driven really across the board that I don't know that there's any area that I think

089our recommendations say you shouldn't investigate right in terms of potential um savings or potential uh ways to look at your expense current expenditures. But definitely I think one of the areas that stand out is really the the salary and benefits increases there. And I think especially against that declining enrollment um it's that has been a major factor um in terms of creating the structural imbalance is when you lose a thousand students and you lose 8 to10 million approximately you know in revenue on an annual basis and yet we continue to hold staffing potentially and I think that's where that staffing analysis needs to happen or we continue to have those additional uh increases that we try to do to stay competitive from a teaching standpoint and a salary standpoint, we've just created a a gap

090that's going to continue to to grow. Um that needs to be evaluated and some strategies discussed to try to really write the ship here at the the end of the day um with this. And so, you know, one of the benefits I would say, uh, having lived in a larger district, um, larger districts often have a little more, um, opportunity, I would say, when it comes to correcting ship. Um, smaller districts sometimes have a little more finite set of of pieces and and resources. And so, making course corrections can be sometimes difficult uh, in smaller scales. Uh so I do think there's some opportunity here being a larger district to uh have some opportunities based on some of the information the district I think finds in some of your analysis. Uh but I think from

091a policy analytics standpoint and kind of sitting in the seat prior um there's definitely some next steps in terms of some additional information uh in terms of expenditures that need to be looked at looked at maybe compared to peers how peers are are looking at in terms of expenses uh and finding some ways to really uh you know the blunt way of saying it is arigning in of expenses uh has to be there because the district doesn't have the ability just like a a business does to say we're going to raise prices or go generate additional revenue, right? Uh your state funding formula and your operations fund um you know really the pieces. So you don't have the ability to go generate new revenue that makes things difficult in a school. And so unfortunately the

092other place we have to look is how do we constrain expenses? Um and I think that's the next step in terms of analysis for the district from the policy analytics perspective as we look at the data. Um and so with that I know that's a lot. It's fast and furious. I know it's um you know some detailed pieces and not obviously the best of news. Uh but more than happy to to answer any questions or address anything that the board may have. >> Again, I want to say thank you for your you and your firm's work and um um going through our expenses, our revenues, and um helping to to just share our story with our community. I think it's it's vital for the steps that we have to take moving forward. Also, we know

093not to schedule you on nights when we're celebrating champions. I think that's very important that we figure that out in the future. >> Um, I think one of the things that we also need to talk about, not talk about, just be aware of is that this is just not through our state revenue as well is through our federal um um dollars. Also, I know that that wasn't included in the presentation. Um just last week, Elcart um well not last week, two weeks ago on June 30th, we were informed that we were going to lose approximately $1.2 billion six, not billion, million dollars, um 6 hours before it's supposed to come into our coffers. Um we've already projected to utilize that money on staffing, on services, on professional development, on how we support our um many

094of our students. It's tough. And the conversations we're going to have to have are also tough as well. So I just don't want to be remiss in saying that at a federal level that's also happening also. And that money is never returning as of now. This will be the last year that we have title two money, title three money, title four money. So how we manage school finances is not going to look like what we thought two to three months ago. Our current reality is that it is we have lots of work to do and there's nothing off the table when it comes to doing that work. So this is not the what I expected when I took the job over two years ago. Um it was I thought I was to to to focus

095on the academics. You know what? Look at our um academic outcomes and our art outcomes and our m and our athletic outcomes at the impact report which you can find on our wonderful new website. Thanks to Wendy Wood, we should be very proud of the work that we're doing for our community. We we we return a lot of investments. So, this is not really a question. And I want people to understand how much Elcart Community Schools means to this community, having a vibrant school community, but also we are number a big part of our job is being physically sound to our um taxpayers as well. So that's something I also take very seriously also. So the conversations working with our community, with our board, with our teaching staff, with our custodial staff, anyone who has

096anything to do with education, I'm going to be asking you over the next few months to to help me brainstorm, to write this ship. This is not a one person's job to fix it. This is many years in the making. I think if I share with the board just looking at the data, I went back 10 years. It's there's been overspending for a long time. And so these are not things that I want to talk about during our board meeting, but I think we need to be super transparent when it comes to finances. Um, if we do not make some significant changes, we will be in a ne we'll have to be in another negative year next year. Deficit deficit financing is awful for a school district. >> Can you talk about some of the

097perils will happen if we do not make any changes? >> Yeah. I mean, so >> like organizations come in and they and they run your district for you. >> Yeah, >> that's what I'm talking about. >> Yes. And >> and how close are we to that if this continues? >> Yeah. So, I you know, the the organization that takes a look at school finances, the distressed unit appeals board, obviously referred to as DUAB, uh they're always monitoring school data. >> Um and looking at the the trending data within those pieces and they do that on an on a frequent basis of reviewing your your financials. Uh so as soon as this most recent uh form nine data as we call it, which is our school financial data documents, uh they'll be reviewing those uh as

098they begin to see the challenges the district's facing uh and they see that churn really on the on the cash balance, they'll be reaching out to the district to sit down and and ask uh are you aware first and foremost? Uh is the board aware? Uh do you have any type of of plan uh within those pieces? And try to work proactively with the district. uh and creating really an effective corrective actions plan. Uh and if you do not do that on your own, they'll require that. Um and depending on the steps moving forward, we'll require you to begin um providing additional information. Now, good thing is you're already looking and have started that additional information in terms of cash flow projections and those pieces, but really comes down to your decisions and ability to

099to enact a corrective action plan to adjust the structural balance. And at the end of the day, if you do not uh as we've seen in previous situations across the state, the state could potentially step in and and take over the district from a financial perspective uh and do a essence uh comes in to try to write the ship themselves. And so it is a very serious situation um that could go down and I do think as we look at this if DAB were to look at the financial pieces we looked up they'd be coming to sit down to see how you're what steps are you taking to adjust. >> Thank you Mr. Um, so I just share that making difficult choices, um, that's what they are. They're difficult. Um, not anything that anyone wants

100to sit down and wake up in the morning and say, "Hey, how can we go and and have tough conversations about changing the structure and the infrastructure of a school district?" That that's just something that I don't think anyone in this room wants to do, but I think leadership requires you to do those things. So again, looking forward to just having these conversations, working with the board, working with our community on how to we get out of this situation and it's not going to happen overnight. It's going to it's going to take some time. Um our number my number one priority and I think our number one priority is make sure our kids have outstanding experiences in the classroom and I do believe that we have some opportunities to do that, but I don't think

101that we can do that if we continue down the path that we've gone down. So being here 18 months, seeing some of the uh internal protocols that we've already started putting in place, I want to assure the community that we are taking this very seriously. Um and there's u conversations that we're having amongst my leadership team and you'll probably see over our next probably every board presentation from this point moving forward some of the measures that we are putting in place to to correct this issue. So, I just want to say thank you for um work being a partner alongside of us as we um write this ship because I know that we will and by having people like yourself, having outstanding um leadership and also working with every other stakeholder in the community who

102is invested in making sure that Elcar is the destination place in the state of Indiana. Forgive your old school districts. I won't hold that against you. Um I think we can I think not only does it need to happen, it will happen. So, I I appreciate the board for all their support for allowing me to work with people like you. Um, and I think knowing where how far we have to go will really change how we handle business moving forward. I didn't know some of these things to be honest with you when I when when I got here. So, thank you for you and your team's work. >> Any other comments from the board? >> No, I I I I want to kind of reiterate thank you for for your work. um you know, let

103the the community know, you know, our eyes are wide open uh as a board. This is something we've been talking about now uh uh for a while. Um you know, I I I think you know, you're you're kind of new to to working with Elkart School. Met about what five six months. Um but I I I will tell you that uh you know, this community is like a community in a district like I know of no other. I remember at one point during the recession, I think Elcart, Elcart County had the highest unemployment rate in the country and uh we were the quickest to turn it around uh as well. And so, you know, that tells you about the resilience of of this community, the district, the people that work for this district. Um I

104believe we can make the appropriate course corrections. Um I think it will I agree with you, it it will take time. Um but uh you know this this is something that you know when you have the data which we do have now we have the historical data we know where we came from what we need to do. We have a great team and great leadership. Um I believe that we will turn this around and you know it it will it will be a group effort. It will take everybody but it will be able to turn around. Um you're right. Uh it I I kind of like the agenda up until, you know, here with the unified track team, but I think >> you you you kind of heard with the unified track team tonight, uh

105the year prior they were undefeated, didn't lose a a track meet, came into this season and had some losses, had some different uh components and uh you know, kind of pulled it together, worked together. At the end of the day, they were state champions. And uh I I I believe that uh this leadership, this district will be able to figure this out and we will we will course correct and come out of it. So uh I I agree with what uh you said as well. >> Thank you. I appreciate it. >> All right. Thank you. >> All right. Next on the agenda, we have consent items. Do I have a motion? >> So move. Do I have a second? >> Second. >> Do I have any uh discussion from the board? This is the place

106where Miss Mullins would say, "Well, yes, we do." She's not here, so I am going to attempt, and I always I always applaud the way she she does it because she's very good at it. So, please uh uh bear with me. But we do have uh some very benevolent uh uh donors. Uh for this week, we have Brinkley RV. Uh they donated $1,000 to the Elcart High School football team to be used to assist with the growth and development of the team. Thank you, Brinkley RV. Uh as many times you've heard before, Welch Packaging Group uh has uh given $1,000 to the Elcart High School football team to be used to assist with the growth and development of the team. Um thank you, Welch Packaging. Elkart General Hospital has given a total of $5,000 in

107the form of two laparoscopic instrument sets, various laparoscopic barlatric instruments, catheters, chest tubes, mesh, orthopedic implants, and sutures with an estimated value of $5,000 to our surgical uh service program uh which will come in uh very useful. So, we thank Elcart General Hospital for that generous donation. We have the Elcart Athletic Club has uh donated $4,000 to the Elcart High School athletic department to be used for the recruiting platform um uh the athletic academy for all Elcart High School sports programs. Um and so this is uh to assist uh our athletes um in in taking the next step to uh play at the next level whether it's uh division one 2 three uh uh athletics and it gives them an opportunity to be seen and and uh by other coaches and other programs in the

108recruitment process. So uh that's a very nice donation as well. So total donations uh for tonight in the amount of $11,000. So, thank you uh to all of those uh generous uh benefactors. Um retirees, we have Laura Corwin, uh special education at Daily uh 16 years of service. Thank you, uh Laura. Gina Parachchini, exceptional learners and psychologist, uh eight years of service, will be retiring. And our last retiree is uh April Hunt, uh from Elcart High School Food Services, uh years of service 11. So, thank you uh for all your uh um time uh served and the commitment to not only the district but the students that you served. >> Thank you. >> I'm sure she >> I hope Kelly is safe. >> I have a motion. I second. All in favor? >> I >>

109opposed. Motion carries unanimously. Old business. Mr. Thorne, you have a number of contracts for final consideration. >> Thank you. Uh, President Scott, members of the board, Dr. Huff, tonight the administration presents for your final consideration proposed contracts first presented to you during your July 8th meeting. The contracts as presented incorporate revisions discussed by the board uh during your prior meeting and agreed to by the contractor. Seeking your approval this evening to those contracts. Do I have a motion? >> Motion. >> I have a motion. Do I have a second? >> Second. >> Do I have any discussion? >> Um, can you uh identify what those uh changes were might have been? >> Well, Mr. Weaver. There were a number of changes uh dealing with the first contract uh that incorporated a number of changes in

110terms of one talking about what had happened in the prior under the prior contract with this particular individual in terms of attendance but also establishing some very clear goals that the contractor is to meet moving forward. uh as to the second contract uh we clarified some issues in terms of how we'll deal with that contract in terms of the number of buildings and number of students moving forward. So in both of those contracts we really I think improve the contracts for the district through the process of further negotiations. U I would make a suggestions that uh when we bring these back and there's changes made, you know, kind of put them in italics, you know, so they're easier to find in there. I'd appreciate it. Thanks. >> Um I just have a a quick comment.

111This goes to I guess old business and new business. Um uh maybe in the future if we could divide it up over some time. We had 389 pages of uh contracts and I guess being an attorney I actually read them and uh it it took a little while but uh um >> depends on how fast you read. >> So uh uh that would be my only uh only comment. But I I do uh uh appreciate the diligence you had with the uh the memos with pre presenting each one. And as uh uh Mr. Weaver stated, you know, um I I think your your memo did address some of some of the changes and laid them out. Um but uh uh to clean up just a little bit in the future would be great, but uh

112thank you for the work you've done on these >> that um I I feel your pain in terms of reading all of those contracts and all of the links to various different components of the contracts that the vendors never really show us until we dig in deep enough to find them all. >> Correct. I I normally start with the term and jurisdiction and get the easy stuff out of the way and then it goes on from there. So, um I have a motion and a second. Uh all in favor? >> I >> opposed. Motion carries. Now on to new business. Uh contracts for initial consideration. >> Yes. This evening the administration presents for your initial consideration contracts which would be recommended for approval not this evening but at the following meeting. Uh, and I think

113you'll find a lot of information related to those specific contracts. Of course, if there are changes you'd like to see, please communicate that to my office so we can begin having conversations with those various different vendors and contractors. >> Thank you. And I I do like this new format. This is a format that we started, I believe. You know, having the contracts, being able to go through them, uh, any issues that we have, we'll get to your office. gives you plenty of times to contact the vendor uh to make uh any appropriate changes or ask for any uh negotiated terms and then get back to us. So, I think this does even though it was 389 pages, I do believe it does flow. >> I I also would add that I think it's it's pointing

114out to our vendors that we're serious about the terms of contracts and we don't just necessarily agree to everything that is asked from them to us. Uh, I can point to a number of contracts that Miss Brander has worked with me on where she's gone back to vendors and said, you know what, we'd like to pay a little less. Sure. >> And so I think we're seeing some of that as well is really trying to send those messages to vendors that Elkart is not just a rubber stamp when it comes to contracts. >> And and I I I appreciate that diligence and also the board's diligence as well. Uh, you know, going through them and working with you and then you guys working with the vendors. So, I think this process is is better now

115that we actually have a a little bit more time to get through these things. So, I uh again, great job by by you and your team. >> Thank you very much. Next on the agenda, sale of iPads. Uh Mr. Rhodess. Good evening, President Scott, members of the board, Dr. Huff. Uh, I'm here on behalf of the administration to seek authorization for the bulk sale of our iPads that have hit the end of their life cycle. Do I have a motion for the bulk sale of the iPads? >> Do I have a second? >> I have a motion. I have a second. Do I have any questions or comments from the board? >> No questions or comments. All in favor? >> Opposed? Motion carries unanimously. Thank you. >> Thank you, >> Mr. Thorne. Back to you.

116Board policy 3410.04 CS substitute compensation. >> Thank you again, President Scott, members of the board. Dr. Huff. Uh the administration is presenting some additional proposed revisions to the substitute compensation plan. Uh which was actually presented to you earlier this summer, but really kind of in light of some of the things you've heard with policy analytics tonight. We're just making sure that in as many areas as possible, the language is clear related to the expenditures for substitute services. And so those are the changes that you're seeing this evening in terms of the policy so that it's clearly in place and clearly well understood by current and future substitute teachers as to the level of compensation they would be eligible for should they come to work for us or continue to work with us here in Elcart

117seeking your approval and actually requesting a waiver of second reading. Do >> I have a motion to approve the substitute compensation and a waiver of second reading? >> Motion. >> I have a motion. Do I have a second? >> Second. >> I have a motion and I have a second. Do I have any questions or comments regarding substitute compensation? Seeing or hearing none, all in favor? >> I opposed. Motion carries. >> Thank you. And in her debut, Miss Ross, the financial report. >> Good evening. Uh good evening board president, members of the board, Dr. Huff, and the community. I know you've had a very important high-level financial update from policy analytics this evening. So I will just provide a brief update on our financials for the year through June. Um I look forward to providing

118more detailed analysis as we uh navigate this process uh and looking at the budget. But do I have the slides here? Let's see. Financial update. All right, I can narrate. Um, so we have um our expenditures. We're just looking at tonight our expenditures and our um operations fund and our education fund. Just high level. Um we are on track with our spend so far from January to June. We average about 3.3 million spend in our operations fund each month and this month we're at 3.2. So we are on track there. Um, and as for our education fund, um, the same. We average a little bit over 7.5 million per month in that account in terms of spend. And we are on, you know, within that range this month at 7.4. I'm not saying it's the

119right level that we want to be at, but we are on track with what we've been doing this year. Um and of just one thing to point out and just to remind us that we are at 97% uh expenditure for uh salary and benefits out of our education fund. So we're trending still a little bit high there. Um and I also was going to present our uh cash flow. So equivalent to like what's in your um checking account. Um, so good news is we've got a nice um we got our revenues from our property taxes uh in June. So that uh increased our cash flow. Um we still are not where we want to be in terms of kind of a cushion, but we'll continue to work and have these conversations with our partners such

120as policy analytics to get this number right. Um and that concludes our slideless financial presentation. M m one way to adjust on the fly. I appreciate it. What should that um you mentioned 97%. What should that number be? >> Yes. Yes. I'm prepared to answer that. So, I've talked to some folks who've um you know been in public finance and school finance for decades. They've suggested 92% is um pretty good. um it could go as high as 95 depending on the health of the district in looking at other metrics. So um I've heard 92 to 95 >> appreciate any other comments or questions from the board. >> Well uh thank thank you for the financial report. It's a little something we do here with new CFOs. We we don't let you see the slides first

121time. A little bit of hazing. See, just Yeah. Just just see how uh how well how committed you are. And you you pass with flying colors. So, thank you. Next next uh board meeting, you'll be able to have slides and everything. So, >> yeah. Thank you. >> If it makes you feel any better, I didn't get lunch the first time. >> Board member, >> right? Yeah. Yeah. His his first time, you know, no food, so >> no lunch. All right. Next we have the insurance report. >> Yes. So before you um you have an insurance uh update. Um we continue to work with our partners Sumis and Marathon and uh making sure that collaboration is working cohesively. Um you'll see that we have a 79% loss ratio um to date uh in as of end

122of June. Um this metric uh measures the percentage of premiums earned that are paid out in claims and related to expenses. So the lower in uh this ratio the better. Um so year-to-ate losses on trend. So we seem like we are doing pretty well there. Um lastly um just a quick update. We are working on communication process improvements with Sumus and Marathon. Um, we're working with them, our business department to enhance our communication materials. So, they're designing some nice materials for us to have ready at back to school and maybe even post in the teachers lounges with QR codes where staff can access their benefits, know what they are, and hopefully maximize them um as they go along. So, that concludes my finance and insurance updates. >> Thank you very much. Any questions or comments

123from the board regarding the insurance? hearing none or seeing none. Thank you very much. >> Next on the agenda, Dr. Hoff, the floor is yours. >> I'll be very brief. I've been giving commentary throughout, so I will be brief my my closing thoughts. Uh I want to first thank um one of our business uh office personnel staff, uh Jennifer Lee, she is was voted to be our representative in district 2 by her peers. That is a huge accomplishment for her. She is probably one of the most friendly people in the world. calm and cool and I I just was very proud and I know that she would not like public recognition. So, let's make sure we put it all on the internet. So, um but wonderful and I think that's that also says a lot

124uh to um just about the processes that we have with that business team in the back. So, again, um hats off to her. Um I want to give a huge thank you to our building principles and staff that have come in this week and have made thousands of calls to family members regarding registration. We we definitely want to make sure those if you aren't registered to get your uh your kiddo registered this year. Um I know that our teams have have some um staff coming in so they can go in there and register their child. Um we're a little bit behind with our registration number. So again, if you hadn't have an opportunity to register, um please reach out to your school. There are somebody there who who help you. Thank you, Mrs. Brander, and

125to um the rest of administration, the principles and uh the secretarial staff who have been making those calls fiercely. I think uh over the last week we increased registration by up to 321 as of Monday. Is that correct, Miss Brandon? >> Thank you. So just with that initial push, we've increased uh 400. So thank you. Hats off to you and your team upstairs. I really appreciate it. Um and last and not least, I want to welcome all those um new staff members to Elcart Community Schools. Um very proud for you to join our team. Uh Mr. Rose, I see you over there. Congratulations on your appointment to being the new CTO of the technology department and you got to present on your first night. Usually that's not how that works. So, but but but congratulations

126to you um and to all of you who are joining the Elkhart family. I I you're joining a family that cares for one another and also a team that's highly committed to making sure that our kiddos are taken care of and we have excellent experiences here. So, welcome to everyone. So, with with that being said, I'll turn it back over to you um President Scott. >> Thank you, uh Dr. Hoff. Miss Tatil, he's the best. He He really is. He He He He make >> Sir, if you have a second, I'm going to record that. >> Okay. I know. >> I was going to say big enough. >> I'm said Todd Sheileely and his team. They are the best when I say that. I mean, I know they're unified. Those kids ROC, you see them

127run around. They're in orchestra. They're in choir. They're in in jazz. multiaceted to see how much leadership skills are in that group of young people um here. It's it's amazing and it doesn't start without adult models like yourself back there. So um we would be remiss. Sometimes coaches are very humble. They just want to make sure the kids get the attention. The coaches are what sometimes keep the kids attracted to school. And so thank you for all our leaders who invested not just in United Track, but I think we had an outstanding year athletically um particularly in the spring season. I think Ben DeVito um you're been all over that. Mr. Weaver, how's he doing? >> Uh actually I have not got a recent update. >> Ask Mr. Thorne. He'll help. >> Actually, actually I

128may have it. >> No, no, no, we're not doing that. Hey, thank you everyone. I'm gonna turn it back over turn back over you. They're ready to go. >> I'll keep talking while you're looking. How's that? I scoreboard keep talking. Um, >> well, he was >> tied for 20 at the moment. >> No, he Yeah, but he uh Hang on. >> There's there's only like 175. >> For context, we have a freshman, our freshman uh golf champion, Ben DeVito, who is who competed at state, is competing nationally in the US amateur golfing. Uh, >> you got it. He even had a star next to his name. I should have looked for that. >> Yeah, he should. >> Uh he he started off strong. I think the first uh first nine holes um he was uh

129even um in the uh back nine. He shot a Well, it just disappeared. Sorry about that. >> That's okay. >> It's just a star. Um, the back nine. Oh my goodness. It was just there. I shouldn't have showed it to you. >> No, >> I think he tied I think he tied for 101st. Um, >> but regardless regardless, this was a a qualifier. This was the best golfers from across the country. And there's not only uh um United States players. It was uh I'm looking at the flags here. Canada, Mexico, um looks like Turkey. Uh so uh Ireland, Sean Keeling, uh from Ireland. So he uh he represented well. Um he is a freshman. He's very young. Um he doesn't have a driver's license yet. >> I have a driver's license. Wow. Okay. Yeah, he

130he Yeah, thank goodness he doesn't drive a cart. Um, so yeah, so he he he had a great showing and I wish I uh could tell you exactly what it was, but either either way, we're very proud of his accomplishments this year. Anyone else? Oh, it went to the top. >> Uh, he finished tied for 165th. He was plus 11. I liked I like my first, you know, tied for 101st. No, 161st, but it was uh the USGA Junior Amateur Championships in Dallas, Texas. It's a it's a very formidable uh tournament. That's, you know, when you start playing in these junior US Junior Amateurs, you know, that's when you know that there there's potential for a future in golf because they just don't invite everybody. So, great job, Ben. I'm sorry. Next time I'll be

131quicker on the uh the results. Anything else? I will uh Mr. Rhodess, um you were let off a little easy tonight. I just want to let you know I understand it was your first time. We were so focused on uh Miss Ross that uh you will have another presentation at some point. So just uh be be prepared for okay, you know, no slides or something. And with that meeting is adjourned. Thank you everybody.