(BEDFORD) - The State of Indiana and 15 Indiana public school corporations, including Bedford North Lawrence announced Tuesday a plan to launch a lawsuit against the Internal Revenue Service over a part of the Affordable Care Act.
Officials confirmed the state is suing the IRS in federal court in order to block the Affordable Care Act's employer mandate, also known as Obamacare.
The United States Department of the Treasury and the United States Department of Health and Human Services are also named as defendants in the suit.
The State of Indiana serves as the lead plaintiff in the lawsuit, according to a press release from Bose McKinney & Evans LLP, the law firm representing the schools. Gregory Z. Zoeller, Indiana attorney general, represents the state.
Gary Conner, NL superintendent, said none of the school's money is being used in the lawsuit.
According to Bose McKinney & Evans LLP, all Indiana public school corporations provide comprehensive health insurance coverage to most of their employees. But most Indiana public school corporations do not have the financial resources to provide affordable, minimum value coverage to all employees who work in excess of 30 hours of service per week.
The Times-Mail reports, North Lawrence recently cut hours for aides and other employees so they do not work 30 or more hours per week because the school system does not have the money to offer health insurance
Conner says the fees and other costs associated with Obamacare have increased the school system's health insurance premium by about 3 to 4 percent.
In addition, the lawsuit notes, the ACA provides for penalties for employers who do not comply.
"In some cases, these potential penalties would result in catastrophic financial consequences for Indiana public school corporations," the news release reads. "To avoid this result, most Indiana public school corporations have been compelled to reduce the hours of certain non-benefit eligible employees, including instructional aides, bus drivers, cafeteria workers, substitute teachers and other part-time employees. These reductions impose hardships upon the impacted employees. Moreover, the schools believe that these reductions will have a long-term detrimental impact on the quality of education provided to children in the state of Indiana, particularly students with learning disabilities."
The lawsuit challenges IRS regulations implementing ACA. It also challenges the authority of the federal government to impose the employer mandate upon the state and Indiana public school corporations.
Other school corporations in the lawsuit are:
-- Metropolitan School District of Martinsville.
-- Perry Central Community Schools in Leopold.
-- Benton Community School Corp. in Fowler.
-- Community School Corp. of Eastern Hancock County in Charlottesville.
-- John Glenn School Corp. in Walkerton.
-- Monroe-Gregg School District in Monrovia.
-- Mooresville Consolidated School Corp.
-- Northwestern Consolidated School District of Shelby County in Fairland.
-- Shelbyville Central Schools.
-- Southwest Parke Community School Corp. in Montezuma.
-- Vincennes Community School Corp.
-- Madison Consolidated Schools.
-- South Henry School Corp. in Straughn.
-- Southwestern Jefferson County Consolidated School Corp., Hanover.
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