MICHIGAN CITY | To avoid the possibility of closing schools, property owners in the Michigan City Community Schools Corp. are being asked to increase their taxes.
Deep cuts over the past year haven't been enough to close what was once a $16 million budget deficit, according to officials.
Permission to raise taxes is viewed as a last resort to restore a revenue stream hurt by factors like state property tax caps and vouchers.
"The alternative is going to lay off teachers and start closing neighborhood schools," School Board member Beryle Burgwald.
Burgwald said the deficit has been trimmed to $4 million by reducing teachers, administrators and other staff, but any further cuts would damage the ability to provide a top-notch education.
He said taxes would increase no greater than 17 cents for every $100,000 of assessed valuation, which translates into a $56 annual increase on tax bills for the average homeowner. Annually, $5.6 million would be generated, outpacing a $1.6 million loss in revenue in each of the past three years.
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Burgwald feels the referendum campaign stands a chance if voters are shown revenues from the increase will not go toward things like salary increases or building projects.
"It's going to be used to keep what we have," Burgwald said.
School Board Vice President Jim Kintzele said the board is working together and has hired a consultant to educate voters on the need for the referendum prior to it appearing on the Nov. 5 ballot.
"To me, it looks favorable," Kintzele said.
Burgwald said the only other option would be to take out a bond issue, which would not require approval from voters. He said a bond issue would only add to the deficit from interest and other fees associated with borrowing funds.