(CHALKBEAT INDIANA) — When Pete Hinnefeld and his wife started looking for a preschool for their daughter, they hoped to send her to the same school her brother attended, which was just down the road from their house and offered Spanish-language immersion.

To do this for Lydia, then age 3, they were prepared to pay the $600 monthly cost.

But after voters approved a property tax referendum to fund early learning for children living within the Monroe County Community School Corporation, the family’s preschool bill was cut by more than half. Nearby preschool cut down time spent commuting to their parents’ house for babysitting, and helped Lydia build social skills.

The family are one of hundreds now benefitting from the 2023 referendum, which has more than doubled the number of children attending 3- and 4-year-old preschools in the district.

“For us, this is why you pay taxes,” Hinnefeld said. “It’s important for young kids to have access to school and if parents need to work, it’s an opportunity to let them work.”

The referendum put forward by the district, located in Bloomington, is a first in the state, offering all families tuition support on a sliding scale based on income, no matter whether children attend a district preschool or a partner provider.

It represents a local solution to problems with accessing and affording early learning that have left thousands of Indiana families waiting for help. Indiana in December 2024 froze its Child Care and Development Fund, or CCDF, and On My Way Pre-K dollars, which provide funding for early learning for income-eligible households.

A $200 million funding increase for CCDF approved by the State Budget Committee this week will allow Indiana to begin issuing vouchers againin May to around 14,000 more children, for a total enrollment of around 57,000. Those funds will last around one year.

Still, around 20,000 children will remain on the waitlist, and families may have fewer options for where to use their vouchers as hundreds of providers have closed since the freeze was announced, according to early learning advocates in the state. In a recent survey of early childhood educators in Indiana — which includes those working in a variety of settings — 90% of respondents said families are struggling to pay tuition.

A statewide universal preschool program is unlikely, Republican leaders have said. Instead, a legislative proposal this year would have let cities and counties — not just school districts — ask voters to fund preschool seats. It failed to get traction, but its advocates expect it to return.

The political climate isn’t especially promising for local tax increases: A new Indiana law has placed caps on property tax revenue that are already affecting local budgets. Lawmakers also recently restricted when schools can place referendums on the ballot.

Still, a new local revenue stream could be a boon in some Indiana communities, such as those with high demand for preschool, existing programs, and high social cohesion, said Sam Snideman, vice president of government relations for United Way of Central Indiana.

“There are going to be communities where this makes a ton of sense,” Snideman said. “The increasing challenge for an entity that goes before the public for a referendum is making a very clear value case. What is the common good and what is in the community interest is very important.”

School district’s pre-K enrollment doubles after referendum

Before Monroe schools brought the referendum request to voters, the district conducted a study that showed there were not enough early learning seats to serve children in the community, said Timothy Dowling, director of early learning and enrollment at Monroe schools. And families couldn’t always afford the seats that were available.

But the district also knew that research links quality early learning improved later academic outcomes, Dowling said.

“We wanted to do everything we can to help our students get the benefit of early learning, because we know it pays off in huge dividends,” Dowling said.

The referendum equated to around a $50 increase yearly for a home with an assessed value of $250,000, according to the district website, and also paid for instructional supplies for K-12 students. It passed with 55% of the vote; Dowling said the community study and transparency about how the referendum funds would be used were key to its success.

As a result of the successful referendum, all families in the district qualify for at least $4,000 in tuition assistance for preschool for 4-year-olds, whether their children attend a district school or at one of seven community providers.

Around 76% students in the district’s program attend for free based on their family’s income, Dowling said. Families in the lowest income tier who send their children to community providers receive $8,000 in tuition assistance.

The program also offers tuition assistance for 3-year-old preschool based on income and where the student attends school. For families making 225% or less of the federal poverty level, preschool is free at district programs. Often those families struggled the most to afford child care, even when state child care vouchers were available, Dowling said.

In 2024-25, the year after the referendum passed, the number of 4-year-olds attending preschool doubled from 184 to 378, with 64 of those children attending preschool at outside centers. This year, the district expanded preschool for 3-year-olds, based on the timeline laid out in the referendum. Enrollment jumped from 78 to 123, with another 33 students attending community child care centers, Dowling said.

With multiple types of providers, families have options, said Kelly Sipes, the executive director for Penny Lane Childcare Centers, which is a partner provider with the district. Those who need transportation might choose a district-run preschool, she said, but those who need year-round care during school holidays can choose a center like Penny Lane instead.

Her centers are usually at capacity, Sipes said, and child care needs in the community persist. When CCDF funding was cut, some of her families turned to the funding from the district instead.

“It’s awesome for the families,” Sipes said. “We should be all in this together as a community.”

Pitching child care: ‘We live in a society’

Replicating referendum-funded preschool might work well in communities where school-based providers already exist, and where there’s a sufficient tax base and steady demand for child care, Snideman said. It would also be an incentive to attract working families.

But it could be a harder sell in rural districts, where there are fewer families and less demand.

Generally, school referendums pass in districts that are wealthier, and in areas with less farmland, said Larry DeBoer, a Purdue University professor emeritus of agricultural economics, who has studied school referendums in depth.One of the biggest predictors of success is whether a school district has tried to pass a referendum before — even if they’ve failed, a second referendum is more likely to pass, DeBoer said.

Monroe schools had previously passed an operating referendum the year before its 2023 preschool referendum. As a county, Monroe has a slightly lower per-person income than Indiana as a whole, and has more students than the small and medium-sized districts most likely to propose successful ballot measures. It’s home to Indiana University, and tends to vote Democratic in a largely conservative state.

A legislative proposal this year, HB 1430, would have given the power to levy preschool referendums to counties and cities, potentially casting a wider net for both family demand and child care providers.

The bill did not receive a hearing, in part because Indiana legislative leaders are usually reluctant to consider bills with a fiscal impact in even-numbered years where they don’t pass a state budget. And the most recent state budget passed in 2025 was tight, with cuts to spending and programs due to a revenue shortfall.

The bill’s author, Rep. Blake Johnson, a Democrat, said that conversations about the bill have been fruitful, and that he expects the idea to return in a future session.

Given budget concerns, a locally funded solution that communities can tailor to their own needs may be more successful than a statewide one, said Patrick McAlister, who leads the Preschool Choice Alliance, a statewide group.

“This is an economic development need. Here’s the tool and the option to exercise it or not,” Johnson said.

A successful referendum would be a boon to working parents who struggle to afford the cost of early learning, said McAlister, who used to be the director of the Indianapolis Mayor’s Office of Education Innovation. But even for non-parents, a preschool referendum could have a positive impact on property values and in other ways, McAlister said.

Ultimately, it would be one part of an “all and above strategy” addressing care for children from birth to age 2.

“We live in a society,” McAlister said. “There are certain things we hold true and caring for children is a value many people share.”

Aleksandra Appleton covers Indiana education policy and writes about K-12 schools across the state. Contact her at aappleton@chalkbeat.org.