A sharp-eyed reader contacted me after the August 12th story on Hamilton Southeastern Schools CFO Tim Brown’s recommended 22-cent referendum rate for 2027, and the question is a good one — good enough that I suspect this reader isn’t the only person wondering about it.

The math question goes like this: the proposed rate of 22 cents per $100 of assessed value is 2.05 cents above the current 19.95-cent rate. Take a home assessed at $400,000, divide by $100, and you get 4,000. Multiply 4,000 by the 2.05-cent increase and you get $82 a year. So why did my article — citing Brown’s presentation — say the increase for a $400,000 home would be about $26 a year?

The multiplication is correct. The missing piece is a feature of Indiana property tax law that trips up nearly everyone the first time they encounter it: referendum rates are not applied to your home’s full assessed value.

The rate applies to your net assessed value

Every owner-occupied home in Indiana receives homestead deductions before any tax rate is applied. The rate — whether it’s the school referendum rate or any other — is levied against what’s left over, called your net assessed value.

And those deductions are in the middle of a major overhaul. Senate Enrolled Act 1, passed by the legislature in 2025, phases in substantially larger homestead deductions each year between 2026 and 2031. By the time the phase-in is complete, only roughly a third of a typical home’s gross assessed value will remain taxable.

So for that $400,000 home, the 22-cent rate never touches the full $400,000. Apply the 2.05-cent rate difference to only the post-deduction value in Brown’s projection and you land right around the $26-a-year figure from his presentation — a little more than $2 a month.

You can check this against another number the district has published: the ballot language will show a maximum rate of 36 cents, which the district says works out to roughly $700 a year on a median home rounded up to $400,000. If the full $400,000 were taxable, 36 cents would come to $1,440 a year — double the district’s figure. The difference, again, is the deductions.

The same math explains why the referendum is on the ballot at all

Here’s the wrinkle worth sitting with: the very mechanism that makes the homeowner impact smaller than the raw rate suggests is also the reason HSE is back before voters this November.

Those growing SEA 1 deductions shrink the tax base that the current 19.95-cent rate applies to, too. A rate can only raise money on value that remains taxable, and as the deductions phase in, that taxable value shrinks every year. That’s how the district projects it would collect about $45.3 million less than originally expected between 2026 and 2031 without a new referendum — even though the rate printed on the ballot is going up, the base underneath it is going down.

Check your own number

Every property is different — assessed values, deductions and exemptions vary parcel by parcel. The district has posted a calculator on its referendum page that estimates the referendum tax impact using your actual property information. If you want to know what the proposal means for your own bill rather than a hypothetical median home, that’s the place to start.