Understanding school finances can feel overwhelming, but Franklin Township Community School Corporation is working to make it easier for the community to understand where school funding comes from and how it impacts our students. In the latest edition of “Flash Finances from Fred,” Chief Operating Officer and Treasurer Fred McWhorter broke down one of the most important topics in school finance: the two primary funding sources that support FTCSC.
Fred explains that FTCSC relies on two main revenue sources: state funding and local funding. State funding comes primarily from state sales tax and income tax, while local funding comes from property taxes.
“One of the biggest misconceptions people have is that property taxes fund everything in schools,” Fred shared. “In reality, property taxes only partially fund the Operations Fund and fully fund the Debt Service Fund.”
Understanding how those funding streams work is important because not all school districts are impacted equally. Fred explains that property taxes are calculated differently depending on the makeup of a community’s tax base. In Franklin Township, approximately 85% of the property tax base is residential property, which is taxed at 1%.
That creates challenges compared to communities with larger commercial or industrial tax bases, which, being taxed at 2% or 3%, generate much more local revenue through higher assessed property values and tax structures. Thus, it provides almost every other school district with more funding per student than FTCSC, which translates to millions and millions of dollars.
“Our residential tax base puts us at a bigger disadvantage than areas of the city that have more commercial and industrial development,” Fred shared.
This video is part of the FTCSC’s ongoing effort to provide transparency and help families better understand how public school funding works. By simplifying complex financial topics into short, easy-to-understand videos, FTCSC hopes to build greater awareness around the realities of school finance and how funding impacts the work happening in classrooms every day.
“Flash Finances from Fred” is designed to make school finances as easy as “3-2-1” while helping the community stay informed about the financial decisions and structures that support Franklin Township schools.