17

The Raymond F. Brandes School 65 is one of two unused buildings Indianapolis Public Schools claims is exempted from the state’s dollar law. (Photo/Marilyn Odendahl)

By Dwight Adams
The Indiana Citizen
November 17, 2023

(Editor’s note: this story has been updated to reflect the attorney general’s motion for an emergency stay was granted by Marion County Superior Court.)

Indiana Attorney General Todd Rokita won his request late last week for a stay in a court ruling granting Indianapolis Public Schools an exemption to the charter school “dollar law,” giving him more time to appeal the decision before IPS can try to sell two school buildings.

The stakes going forward are high for both parties.

Rokita had said the earlier ruling in favor of the exemption would have impeded “the State’s ability to obtain meaningful appellate review of the Court’s judgment.” However, IPS, in its response, said that such a delay could kill the impending sale of one of the school buildings, thereby costing Indianapolis taxpayers more than half a million dollars in lost revenue.

“The purpose of the Dollar law is to make vacant and unused school buildings available to Charter Schools for educational purposes,” Rokita said in his emergency motion for a stay pending appeal, which he filed on Nov. 15. “A sale of the building while the State’s appeal is pending frustrates that purpose” and would force the state “to first unwind the sale before making it available to interested Charter schools.”

Rokita had to move quickly, filing his motion just two days after the ruling by Marion County Superior Court Judge Heather Welch. He pointed out in his stay request that, on the same day of the ruling, IPS had scheduled a meeting of its school board for Nov. 16 to approve the sale of the Francis Bellamy School 102 to the nonprofit Eclectic Soul VOICES Corp. In July, the IPS School Board also indicated an interest in selling the Raymond Brandes School 65 to VOICES.

Filing its opposition to Rokita’s motion on Nov. 16, IPS’ Board of School Commissioners said the matter was urgent, because Eclectic Soul VOICES had a purchase agreement to buy the Bellamy School for $550,000 and the closing must occur by Nov. 30. “The reason for this urgency is undisputed,” IPS said, because VOICES must vacate their currently leased space in Fountain Square “in early 2024.”

“Despite this, the State asks this Court to enter an extraordinary remedy of prohibiting IPS from completing this sale during the pendency of an appeal, which cannot be completed in time to save the Voices transaction,” IPS said in its opposition to Rokita’s request. “In the Motion, the State never addresses or disputes that this Court granting the Motion will very likely kill this deal — costing IPS and its taxpayers $550,000.”

On Nov. 17, Welch issued an order granting Rokita’s request for the stay “pending resolution of the state’s appeal.” “The parties shall maintain the status quo until any appellate decision is certified,” Welch’s order said.

Levy Exemption

The dollar law was adopted by the Indiana General Assembly in 2011 to let charter schools buy vacant or closed public school buildings for $1 or to let them lease the buildings for $1 a year. It was an inexpensive way to let public charter schools acquire unused or underutilized buildings for educational purposes, since they didn’t have the power to levy local taxes to raise money to buy such buildings.

During the 2023 session, the legislature amended the dollar law to create an exemption. The Levy Exemption, as it is called, excuses school corporations from selling buildings for $1 if they are already providing money from a property tax referendum to charter schools.

IPS claimed it was covered by the exemption because it was already distributing $4 million annually from a 2018 educational referendum to local charter schools, specifically to the Innovation Network Charter Schools. The agreement with INCS began in 2021 and continues through 2026.

However, the state argued that the Levy Exemption would not apply in IPS’ case, saying that IPS’ 2021 agreement did not comply with a 2023 amendment to the dollar law specifying requirements for revenue sharing and referendum language necessary to be met to receive the exemption.

In her Nov. 13 ruling, Welch sided with IPS, saying the new disbursal formula outlined in the 2023 amendment did not apply retroactively to IPS’ 2021 agreement with INCS, because the school district was already distributing the funds to those charter schools. “The Court finds that IPS is currently exempted from the Dollar Law under the Levy Exemption for as long as it continues its distributions under the current regime,” Welch stated.

In his motion for a stay of Welch’s ruling, Rokita argued that IPS’ sale of the two school buildings before the state’s appeal was decided would “cause significant and irreparable harms,” adding that the dollar law was meant to make vacant and unused school buildings available to charter schools for educational uses “before they can be disposed of by school corporations for non-school uses.”

“If the trial court’s judgment is in error, IPS’s premature sale will cause irreparable harm to the State and the public,” Rokita asserted in his motion. “The remedies available to the State – either by unwinding the sale and putting the buildings back up for use by charter schools or collecting the proceeds of the sale – do not remedy the harm that the education use of the building has been interrupted and interested charter schools have been deprived of the opportunity to make use of those buildings in the meantime.”

 In its response, IPS said the General Assembly had already “crafted a legal remedy as a perfect fit for this generalized risk of harm.” It said state law already required any school corporation that does not adhere to the dollar law’s requirements by attempting to sell or lease such properties to charter schools first must submit any proceeds from a sale to the State Board of Education. That money would then be distributed equally between charter schools located in the attendance area of the building being sold.

IPS also pointed out that the state did not provide evidence that any charter schools actually wanted to purchase either the Bellamy or Brandes schools. It said Rokita would instead prefer to “scuttle” the deal with VOICES “on the off chance that perhaps the State will win on appeal and perhaps a charter school may want one of the buildings.”

“In that regard, it is telling that no charter schools have sought to intervene in this matter to assert an interest in either of the buildings,” IPS said.

Dwight Adams, a freelance editor and writer based in Indianapolis, wrote this article. He is a former content editor, copy editor and digital producer at The Indianapolis Star and IndyStar.com, and worked as a planner for other newspapers, including the Louisville Courier Journal.