Chamber Outlines IPS Budget Recommendations

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The Indy Chamber has detailed recommendations it says will save Indianapolis Public Schools more than $477 million over the next eight years. The chamber released the findings of a four-month financial and operational assessment of the district, which has been looking for ways to deal with a budget deficit. 

The assessment says a $100 million operating referendum will allow the district to close its deficit and fund salary increases for teachers and principals. The IPS Board of Commissioners will vote next week on an operating referendum that will appear on the November ballot. 

The chamber says the recommendations would slightly increase class size by slowing the rehiring of teacher vacancies created by retirements and other departures. The savings from that would help fund average pay raises of 16 percent for teachers, $150,000 salaries for principals, and 2 percent annual raises throughout the district over eight years.

"We’ve proposed significant reductions in non-instructional staff, but still needed to make a modest tradeoff in class size and teacher headcount to fund higher salaries,” said Michael Huber, chief executive officer of the INdy Chamber. "In the end, research convinced us that highly-qualified educators make the biggest impact on academic achievement – we believe that better pay for teachers and principals is well worth the added 1.5 students per classroom."

Other recommendations from the assessment include:

  • Implementing an extensive list of general operating efficiencies – from outsourcing some tech support functions to contracting out nursing support and capitalizing on pharmaceutical rebate programs – adding up to nearly $70 million in savings;
  • Reducing Central Office staff by 50%, streamlining administrative costs and aligning with the reality that many of the district’s fastest-growing (innovation) schools operate with less centralized oversight;
  • Right-sizing excess facilities – as IPS currently operates space for 43,000 students against an expected 2018-19 enrollment of just over 31,000 – shedding the equivalent of 8,600 ‘empty seats’ over three years while keeping a 10% ‘cushion’ to accommodate unexpected enrollment increases;
  • Phasing out high school bus service by exploring expansion of the district’s IndyGo pilot to serve its four remaining high schools and increasing ‘walk zones’ to curb transportation costs;
  • Reducing custodial costs with a smaller facility footprint and seeking additional savings based on a comparison of current IPS custodial staffing versus peer districts;
  • Executing the Broad Ripple High School lease proposal from Purdue Polytechnic and Herron, capitalizing on this time-sensitive, $8 million opportunity for a productive, educational use for the property;
  • Along with right-sizing unused facilities, exploring the sale of the Central Office headquarters

The chamber says the projected $477 million savings would wipe out the IPS deficit from 2019-2016, which is projected to be $319 million. The proposed operating referendum, according to the assessment, would take care of a funding gap created by the teacher and principal raises and an 8 percent cash reserve.

"These recommendations are grounded in common sense – like pushing money into classrooms instead of funding excess facilities," said Huber. "The pace of change may seem dramatic, but the cost of delay is unaffordable – for students and parents, for educators dealing with limited resources and lagging paychecks, and for local taxpayers."

The $100 million operating referendum, combined with a $52 million capital referendum that has already been approved for the November ballot, would create an average tax increase of 5.7 percent across all property types, according to the chamber.

The IPS Board of Commissioners will consider the operating proposal July 17.

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