Legislative Update: Filling in the Blanks

This week, House Republicans unveiled their 2019 priorities (closely aligned with the Senate GOP’s announcement last week) and the State Budget Agency released details of Governor Holcomb’s budget plan, building on his ‘Next Level’ legislative agenda with modest increases in K-12 (thanks to good news on revenues and lower-than-expected Medicaid estimates).

As you’d expect, there’s plenty of agreement on the basics – a balanced budget, boosting school safety and teacher pay, strengthening workforce and child welfare programs – but we need to fill in the blanks on notable omissions from their respective ‘to do’ lists.

For example, neither the House or Senate Republicans joined the Governor in including bias crimes on their agendas.  House leaders are hyping HB1093, a bill without specified characteristics that wouldn’t provide clarity to the justice system or confidence to the diverse workforce we need to grow.

We also have plenty of work to do on tobacco reform; raising Indiana’s cigarette tax to invest in public health didn’t make it into the budget or a separate bill – yet.  But popular support is ahead of Statehouse sentiment: A new Raise it for Health survey shows 70% of Hoosiers support the increase – a bipartisan majority eager for breathing room between Indiana and the other states with high smoking rates (ours is actually growing) and low health scores.

Holla if you hear me!
It’s only the second week of session, but lawmakers are already ignoring or looking for loopholes on two of our top priorities – they need to hear from you.

This week, we joined our partners at United Way of Central Indiana to launch their Indiana Forward campaign; working together with Indiana Competes, we’re showing the strength of support for bias crimes legislation that protects Hoosiers from hate and our economy from the consequences of inaction.

Maybe the biggest threat to our forward momentum is the temptation to dodge controversy by passing a bill with no specifics (i.e. HB1093), a move that would draw only negative attention and raise more questions about Indiana as an inclusive place to live, work and do business.

The General Assembly has an opportunity to support progress with the passage of a bias crimes law with enumerated characteristics, to reflect the diversity of Hoosiers.  Anything less would only keep Indiana behind the times and out of the loop for new business opportunities.

That’s why we need your help to keep building Indiana Competes and step up our efforts to show lawmakers that employers, civic leaders, taxpayers and voters across the state – and in their districts – demand a comprehensive, unambiguous solution.

You can be heard on cigarette taxes, too, by signing up and contacting your legislator through Raise it for Health; show that Hoosier business leaders are part of the 70% who want to build a healthier workforce and recovery some of the billions in annual losses in productivity and higher health costs due to tobacco use.

On both issues, the message is simple: We’re tired of looking up at other states, stuck among the five holdouts without inclusive laws to welcome diverse talent, spending less on public health than all but two others.  It’s time for Indiana to lead, and leadership has to start with the business community speaking out.

Pay teachers more, or get sent to detention:
The House GOP plan to raise teacher pay relies on efficiency – if that sounds familiar, it’s because our IPS operational assessment (finding hundreds of millions of dollars in potential budget savings to put referendum dollars into educator salaries) helped inspire the idea.

HB1003 sets targets for school districts to spend less than 15% of their state funding on ‘non-classroom’ costs, presumably freeing up money for teacher pay, or be called to the principal’s office (in this case, a public hearing of the State Board of Education – unless it gets abolished by HB1147) to explain themselves.

In the case of IPS, meaningful opportunities to raise salaries meant a mix of efficiency and new revenue, hard to come by in lean fiscal times.  We’ll be watching to see how this plan evolves in tandem with the budget.

Healthy choices:
Many of us are struggling with our New Year’s diet resolutions…but for many families across Indianapolis and the state, the situation is more dire, with healthy food options out of reach altogether.  SB143 creates a sales tax district in ‘food deserts’ to support more healthy choices, while HB1143 creates a state grant program for the same purpose.

It’s notable that Indiana ranks 39^th in obesity, along with our 44^th spot in smoking rate.  Issues like food deserts and tobacco reform are important because of the costs of poor health – lost productivity, higher health premiums and public spending on Medicaid – that take a toll on employers and individuals alike.

Bill-filing bonanza:
Among the flurry of bills dropped in the hopper before the Thursday deadline, we’ve identified more than a hundred aligned with our legislative agenda.  In addition to those mentioned above, here are some of the most notable (we’ll mention others as they see action in committee):

Bias Crimes

• We mentioned the House bill we don’t like, but HB1020, HB1159, HB1203 andSB12 are all positive, comprehensive efforts to truly address the issue.

Economic Growth

• HB1088 provides a sales tax exemption for data warehouse equipment (evolving our tax incentives to capitalize on high-tech opportunities – similar to the software-as-a-service sales tax issue last year);
• SB83 allows local governments to divert 15% of TIF proceeds to infrastructure needs, flexibility that could be useful for cash-strapped local governments;
• SB285 gives local governments income tax options to fund public transit;
• SB298 creates a small business tax incentive.

Local Government Issues

• HB1234 creates an affordable housing tax credit that could help make workforce housing more accessible (though we need to identify ways to address the supply of such housing as well);
• HB1011 and SB37 addresses redistricting reform as we approach the decennial census;
• HB1101 allows counties to levy a food and beverage tax to support capital projects that advance economic development;
• HB1111 funds payments-in-lieu-of-taxes (‘PILOTs’) for state-owned properties in counties with high concentrations of public and other tax-exempt parcels – a potentially big win for Indianapolis;
• HB1177 mandates that townships hoarding large fund surpluses develop a capital plan to reinvest in the communities they purport to serve – another small but common-sense step in the push for local government reform;

Government reform also involves accountability – electing visible policymaking roles and appointing primarily administrative positions…which brings us to:

Education & Workforce

• HB1005 allows the Governor to appoint the Superintendent of Public Instruction starting in 2021;
• HB1002 creates a career coaching grant program for K-12 career counseling and allows the skill enhancement fund to be used for certain incumbent workforce education purposes;
• SB93 creates the ‘Let Indiana Work for You’ campaign towards college graduate retention;
• SB335 allows the children of undocumented immigrants to receive in-state tuition rates, recognizing the need for talent and educational attainment as an urgent priority;
• A number of bills helping ex-offenders re-enter the productive economy (and avoid recidivism), including SB124 and SB235 dealing with expungement of criminal records and SB339 allowing certain ex-offenders to apply for post-secondary financial assistance.

Closing the gap:
A final note in this marathon update of a busy second week of session – in the past, legislators have been willing to take bold action to build a more competitive tax climate: Property tax caps, phasing out the inventory tax, an ongoing schedule of cuts to corporate income taxes – the list goes on.

But it’s not enough to lead with an affordable business climate and another Top 10 ranking from the Tax Foundation.  On behalf of the business community, we need action on other issues, too:  In today’s talent-driven economy, Indiana can’t afford to stay stuck as one of five states that turn a blind eye to bias crimes, or languish in 48^thplace in public health spending when employers need a productive workforce.

It’s time to step up.

And for even more up-to-the-minute news on #INLegis, follow the Business Advocacy team on Twitter:

Mark Fisher - @FisherIndy
Tim Brown - @TimJBrownLaw
Taylor Hughes - @STaylorHughes