ANDERSON – The city of Anderson’s indefinite capture of tax dollars through tax increment financing, the state circuit breaker that caps tax revenue and limited tax collections remained sore spots Tuesday as Anderson Community Schools conducted its statutorily required annual budget hearing.

And restructuring by the state of the funds into which money goes did nothing to relieve any of the issues.

In addition, the district has added two funds to reflect the movement of money from the $41 million capital improvements and $1.8 million operations referendums approved by voters in 2018.

“It’s been a learning year for everybody. The state has changed things almost weekly,” said ACS Chief Financial Officer Kevin Brown.

The overall tax rate for $92.7 million 2020 budget is expected to increase from 1.9226 in 2019 to 1.9870. The 2019 rate is the highest among school districts in Madison County.

Brown, Jeanne Chaille who on Tuesday was appointed by the ACS board to the city’s Redevelopment Commission, and Joe Carney, a resident who is a regular at the board meetings, expressed frustration the city could make a unilateral decision through a TIF district that affects other taxing bodies.

“It captures all new assessed value, and we lose assessed value on all the old buildings being torn down,” Brown said.

ACS board member Jeff Barranco, who has challenged the city and represented the school district in its attempt to seek a 15% return of TIF money, said the loss amounts to about $1.9 million.

“We have no say in it at all. They say, ‘We’re stealing more money from you. Too bad,’” said Brown, who has been tracking the TIF situation since 1984. “They hold the marbles, and they carry on.”

Chaille said she was most frustrated by the lack of an expiration date on TIF. Once the city has captured the amount for which they advertised, they issue more bonds, she said.

“It’s a great development tool for the city, but there needs to be an end date to return properties to the tax rolls,” she said.

Brown said ACS is in the top 10 among Indiana school districts with the highest losses due to the circuit breaker that limits property revenues. The district loses between $8 million and $9 million annually because of the caps, Brown said.

“The budget does maximize all available revenue as allowed by state law,” Brown assured the board.

In addition, ACS collects only about 67% of property taxes that are due, he said.

In the meantime as ACS fights its battles with local and state officials, Brown said there are some small things that can be done to stabilize the budget, including keeping an eye on staffing, which has been creeping upward over the past several years; encouraging more enrollment among student residents; and review how buildings are used.

The number of staff, he said, has crept up from 881 in the 2016-17 school year to about 924 now.

The district also needs to market itself better and share the good news of student success to attract more of its native population, some of whom may opt to attend schools in other districts under school choice or enroll in charter or private schools, Brown said. The state gives ACS nearly $7,000 for each student enrolled.

To that end, Brown said, the D26 Career Center is a bright spot with a high return on investment.

“We need to reap the benefits of what we invest there,” he said.

With the reopening of the once-mothballed building that now is Anderson Intermediate School, the population pressure around the district has been relieved, making it possible to enroll more students, Brown said. However, the district needs to be careful about how it uses its newfound space.

“It costs money to maintain square footage whether it’s occupied or not,” he said.