DeKalb County Central United School District

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Senate Enrolled Act 1 Impact &

Potential Bond Financings

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Luke Bruggeman

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September 4, 2025

Senate Enrolled Act 1

Page 2

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Relationship of Net Assessed Value, Levy, and Tax Rate

Possible result of SEA 1

Page 3

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Historical Total Levy Breakdown

• DeKalb Central Schools’ total levy has increased annually an average of 4.1% since 2019

Page 4

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Historical Total Tax Rate Breakdown

• DeKalb Central Schools’ net assessed value has increased an average of 7.8% annually since 2019 resulting in a $0.22 decrease in total tax rate

Page 5

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Senate Enrolled Act 1 – Impact to DeKalb Central Schools

Debt Service Rate – Any school that has a debt service tax rate over $0.70 will be required to place all new debt issues on a referendum ballot. Effective as of July 1, 2025.

• Implications to DCS– current debt service tax rate is $0.3151. Not an immediate concern but something to monitor with a declining net assessed value due to deduction changes in SEA 1.

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Assessed Value Changes

• Homesteads: Proposed increase to homestead deductions, driving down a home’s net assessed valuation. SEA 1 increases the total deduction to 67% by 2031. For a $250,000 home, this results in a 34.65% decrease in their net assessed value.
• Farmland and 2% Properties: Phases in deductions from 0% to 33.4% through 2031. Decrease in agricultural land AV of 33.4%
• Commercial: Removes the 30% depreciation floor for business personal property tax placed into service after January 1, 2025. Includes an exemption for businesses with under $2,000,000 in BPP. 30% floor will remain for BPP placed into service before January 1, 2025 and any BPP in a TIF.
• Implications to DCS – DCS will have to increase their tax rate to generate the same levy, due to the decrease in net assessed value (unless there is enough organic growth in their tax base or positive trending in assessed values to offset the loss).

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Operations Fund – Max Levy Growth Quotient (MLGQ) is capped at 4% in 2026. Charter Share begins in 2028

• Implication to DCS - the School will be able to increase their Operations Fund levy by 4% in 2026. Future legislation will determine the rate beyond 2026.

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Credits – Homeowners receive up to a $300 credit, Over 65 receives an additional $150 credit.

• Implications to DCS – This will be a straight revenue loss, with no replacement revenue available. This is expected to be applied proportionally to all property tax funds.

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Local Income Tax Changes– Schools will no longer receive Local Income Tax Revenue beginning in 2028. Property Tax Replacement Credit will expire in 2028.

• Implications to DCS (Local Income Tax Shares) – DeKalb Central Schools currently receives $576k annually from local income tax shares that is receipted into the Education Fund.

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• Implications to DCS (PTRC) – DeKalb County residents currently receive a Property Tax Replacement Credit (“PTRC”). Homeowners that are not at their 1% tax cap, will see an increase in their tax bill once PTRC is eliminated. Homeowners that are at their 1% tax cap will see no change, but the municipalities will have an increase in their circuit breaker loss.

Page 6

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Senate Enrolled Act 1 – Impact to DeKalb Central Schools

Referendum – Requires that all referendums be on a general election. Changes the language of the question and timing of sharing dollars with charter schools.

• Implications to Schools – schools can only run a referendum at a general election. The next general election is November of 2026. Some schools will be required to run a renewal earlier than anticipated to meet this timing. A failure of a renewal would happen mid-school year and could require immediate changes.
• Schools will be required to share revenue with charter schools beginning with new referendums conducted after January 1, 2027. Only affects schools that have the greater of 100 students or 2% of their spring ADM attending non-virtual charter schools.

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Budget Process – Requires that a school have a decrease in tax rate for each year there was an increase in NAV, subject to any adoption by the board.

• Implications to Schools – Requires additional steps and hearings for budget process if the levy exceeds the prior year.

Page 7

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

SEA 1 – Standard and Supplemental Deduction

Source: Average Home Value is based on American Community Survey

Page 8

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

SEA 1 – Potential Impact to NAV and Tax Rate

Consult with your bond and local counsel on any legislation for their interpretation and how it applies to your specific school

Source: https://iga.in.gov/pdf-documents/124/2025/senate/bills/SB0001/SB0001.05.ENRH.pdf

Source: Average Home Value is based on American Community Survey

Disclosure: Calculations are for illustrative purposes only to understand the potential implications of Senate Enrolled Act 1. Does not factor in potential gross assessed value changes to properties, potential shift in property tax caps, or other legislative changes. To identify a more specific estimate, a parcel-by-parcel analysis would need to be conducted. Does not factor in any changes to 3% properties with business personal property tax changes or trending.

Tax Rate = Levy/NAV * 100

Page 9

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Potential Loss from New Homeowner Credit Beginning in 2026

Source: https://iga.in.gov/pdf-documents/124/2025/senate/bills/SB0001/SB0001.05.ENRH.pdf

Disclosure: Calculations are for illustrative purposes only to understand the potential implications of Senate Enrolled Act 1. Does not factor in potential gross assessed value changes to properties, potential shift in property tax caps, over 65 credit, or other legislative changes. To identify a more specific estimate, a parcel-by-parcel analysis would need to be conducted. Does not factor in any changes to 3% properties with business personal property tax changes or trending. For purposes of this analysis, it is assumed that all homesteads pay 1% of their gross assessed value.

Amount is likely inflated due to all homeowners not being at their tax cap. Likely to be approximately $550-750k annually

Page 10

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Property Tax Replacement Credit Example

Homeowners at or near their cap will experience little difference in their bill but the municipalities will see a decrease in revenue collections. Homeowners below their cap will see an increase in their bill.

Page 11

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Bond Financing

Page 12

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Outstanding Debt Payments

Page 13

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Current Debt Service Levy

Page 14

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Current Debt Service Levy + Potential 2025 GO Bonds

(1) Assumes 5% Interest Rate on future bond issues

Page 15

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Current Debt Service Levy + Potential 2025 GO Bonds + 2026 Bonds

(1) Assumes 5% Interest Rate on future bond issues

Maintain current 2025 debt service levy. Provides additional borrowing capacity within 2029 levy

Page 16

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Potential Projects with 4% Levy Growth Annually

(1) Assumes 5% Interest Rate on future bond issues

Increases levy 4% annually (historical levels). Allows bonds to be repaid with less interest cost and providing additional borrowing capacity

Page 17

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43

Comparison of Scenarios

(1) Assumes 5% Interest Rate on future bond issues

Page 18

R: 0 G: 48 B: 87

R: 151 G: 153 B: 155

R: 101 G: 141 B: 27

R: 0

G: 163 B: 224

R: 241

G: 196 B: 0

R: 179

G: 163 B: 105

R: 229

G: 114 B: 0

R: 81

G: 42

B: 68

R: 143

G: 50

B: 55

R: 92

G: 70

B: 43