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Where the Rubber Meets the Road

Posted by chamberadmin on March 17, 2017

One recurring theme of this General Assembly has been the tension between House and Senate plans for infrastructure funding, early childhood education, and raising revenues for these and other priorities…for the next biennium and beyond.

Houses Divided 
With GOP super-majorities in both chambers, you might expect the differences to be minor – intramural squabbles, not ideological divides – but we’ve detailed significant policy issues between House and Senate plans (and the budget strategies of their respective fiscal leaders).

Two critical committee hearings this week show the Statehouse schism hasn’t narrowed much.  We’re in the last month of the session – with infrastructure funding still a key sticking point, it seems appropriate to say this is where the rubber meets the road.

How leadership finds common ground in the next few weeks – and how Governor Holcomb is able to exert his will during his first budget session – will largely determine whether we judge this session as a success or a disappointment for Indy’s business community and our economic development agenda.   

“Where we’re going, we don’t need roads.” 
This week, a joint meeting of the Senate Transportation and the Tax & Fiscal Policy Committees heard HB1002, the House infrastructure bill.  Groups like the Indiana Family Institute and Americans for Prosperity kept up an anti-tax drumbeat for the Senate panelists.

Their view of low taxes as the business climate bottom line is contradicted by most actual employers.  (In its annual survey of U.S. corporate executives, Area Development Magazine reports that highway accessibility routinely ranks far above any measure of tax affordability as a site selection factor.)

On behalf of thousands of businesses across Indiana’s largest region, the Indy Chamber’s Mark Fisher made the case:  “As we ask employers to consider making long-term commitments to Central Indiana, they deserve long-term confidence that our infrastructure will continue to be a competitive advantage.”

At an impasse in the debate over gas taxes, interstate tolling and other revenue options, some senators even questioned the need for far-reaching investment in roads, highways and bridges.  INDOT officials were quizzed about the scale of its long-range strategic plan – informed by the private sector and national experts on infrastructure financing.  (Maybe they’ve seen ‘Back to the Future’ enough times to believe that mass-produced flying cars are right around the corner?)   

As lawmakers weigh the political peril of raising taxes versus this comprehensive analysis of Indiana’s transportation future, we continue to strongly endorse a long-term, fully-funded plan.  We believe that Hoosiers can afford a few extra cents at the pump and on the price of cigarettes, far more than we can afford to undermine our manufacturing and logistics sector – and overall economic competitiveness – with a short-term, nickel-and-dime approach to these vital assets.   

A Lesson in Gamesmanship 
The Senate flexed its muscle on another important House bill at a marathon Education Committee hearing on Wednesday, essentially replacing the substance of HB1004’s pre-K pilot with the stripped-down program outlined in SB276.    

(We ran down the critical differences in the two plans last week.  While the funding for HB1004  is included in HB1001, the bill is geared towards a $20M, 10-county expanded ‘On My Way Pre-K’ pilot; the Senate version slashes the modest increase in funding proposed in the House plan by more than two-thirds, though it allows more counties to opt in to the program with a ‘cash-only’ 10% local match.)

The bill was further amended to create an enrollment priority for children in foster-care, and remove a proposed study of the pilot impact.  (On the other hand, there was some concern about expanding the pilot at all before gathering enough data to analyze initial results.  Of course, volumes of research and the ongoing experience of 40+ other states show the strong return-on-investment of quality pre-K.)   

By simply swapping out the House language in a preemptory move just 30 minutes into what would become an eight-hour hearing, Senate leaders seem to be sending a message that could apply to infrastructure and the budget – the ‘upper house’ is angling to have the upper hand on key issues.     

What Really Matters 
As the General Assembly maneuvers towards conference committees in April, it’s sometimes easy to lose sight of what it all really means outside the limestone walls of the Statehouse.  On pre-K, the outcome impacts the futures of tens-of-thousands of Hoosier children from low-and-moderate income families who will enter school before there’s another realistic opportunity to expand these programs.   

The United Way of Central Indiana and the Indy Chamber organized a tour of St. Mary’s Child Care Center in Indianapolis for lawmakers and others on Wednesday.  Participants got a first-hand look at a Paths to QUALITY-certified pre-K center in action, with trained teachers focused on the cognitive, emotional and social development of a diverse group of 3-5 year-olds – a classroom experience that pays off in educational achievement, earning power and productive citizenship for a lifetime.   

These opportunities to succeed shouldn’t be reserved for the well-off or fortunate pilot participants, or entrusted to a 9’x6’ iPad screen.  Until the final day of the 2017 session, early learning advocates will keep pushing for a $50M statewide investment towards truly affordable, accessible pre-K.   

Counterproductive Compromise 
While the House and Senate face off on a number of issues, one area where the rhetoric has thawed a little is – unfortunately – cigarette taxes.  Speaker Bosma indicated this week that he could be amenable to a compromise from the $1-per-pack increase reflected initially in HB1578 (later inserted in HB1001); perhaps moving towards a 60-cent hike.   

The Alliance for a Healthier Indiana has swung into action to nudge the dialogue back to the $1 increase, for the well-being of Hoosiers and fully-funded smoking cessation and other programs.  As we’ve described previously, the cigarette tax also has implications for infrastructure, as the House has earmarked some of these revenues to allow 100% of Indiana’s gasoline tax revenue to be dedicated to roads and highways.   

Where’s Our Pot of Gold?         
As we send this on St. Patrick’s Day, it’s tempting to drown our sorrows over a few policy and fiscal setbacks over a green beer (or two).  There’s no legislative leprechaun hiding around the corner, waiting to grant our funding wishes for education, infrastructure and economic development priorities.   

The General Assembly will have some challenging decisions to make over the next few weeks – we’ll be pushing for the right choices:  Indiana needs a better-prepared workforce, thriving communities (supported by programs like Regional Cities) connected by a world-class transportation system, bolstered by investments in entrepreneurship and innovation that make Indy (and the state) a more appealing destination for high-tech growth and high-wage jobs.