This is the Remix

This week,
lawmakers dropped new beats on current bills, remixing the Statehouse
soundtrack as the last few weeks of session loom ahead.  There were major changes to the gaming bill,
the Capital Improvement Board (CIB) revenue plan and economic development
policy.  If that wasn’t enough, the
Senate released its version of the budget Thursday morning. 

To quote the
Beatnuts, “Watch out now!”  With heavy
committee action and more bills getting shuffled to the floor and the
Governor’s desk, if you blinked you might miss something.  Here’s our take.

New School

We like our
old school hip-hop references here, but this session definitely has a “new
school” spin: Top fiscal leaders like Todd Huston and Ryan Mishler are guiding
their first budgets, and school funding – as usual – is a top issue. 

In fact,
each iteration of HB1001
has upped the ante on state tuition support: The Senate amendment nudges the
numbers a little higher, for a 4.9% biennial bump for K-12 funding (versus 4.3%
from the House and 4% originally proposed by the Governor).  Taking a closer look:

• Like Governor Holcomb and the House, the Senate
  GOP shied away from requiring that additional funding go to teacher pay; they
  did add to Teacher Appreciation Grants (now at a $90M two-year total) which are
  targeted to bonuses and base salaries;
• The Senate took a tougher position on charters
  (especially virtual programs), cutting per-student support from $1,000 (House
  passed) to $500;
• As Senator Mishler hinted last week, the Senate eases
  cuts in ‘complexity funding’ for high-poverty school districts (and added English
  Language Learner funds) to support challenged urban and rural communities;
• There was little change in workforce priorities
  (doubling Workforce Ready and Next Level Employer grants), though the Senate
  did add $1.5M for Industry Credentialing Organizations to align with SB420 (supporting career-focused credential programs,
  which was engrossed on second reading);
• On economic development, there was general
  alignment, though the Senate did trim funding for the Business Promotion &
  Innovation Fund (back to the Governor’s original $15M/year request) and cut the
  21^st Century Fund by about $8M a year.

A lot
depends on next week’s updated revenue forecast and how funding matches up with
the final version of SB563 (economic
development), but we’d certainly prefer more investment in entrepreneurship and
innovation initiatives.

The
Senate-remixed HB1001
passed the Appropriations Committee, and after new revenue data is presented by
the State Budget Agency next week, we’ll have a good idea of the positions and
parameters that will shape the fiscal negotiations to come.

The CIB Scoreboard

On Monday,
the Ways & Means Committee made significant changes to SB7, the Capital
Improvement Board funding bill, which then passed third reading on Thursday. 

The amended
legislation removes a proposed Hilton development at Pan-Am Plaza from the PSDA,
including other downtown hotels to provide longer-term funding (on a sliding
scale) for a convention center expansion and upgrades to Bankers Life
Fieldhouse and other facilities.

As hoteliers
debate downtown room capacity adjacent to the Convention Center and the Pacers deal
looks to be a slam dunk at today’s CIB meeting, the Indy Eleven franchise has
quietly dribbled towards their goal: Funding potential for a new $150M soccer
stadium stayed in the bill, minus a requirement that the team join the MLS by a
predetermined date.

Wanna bet?

Ways &
Means also dealt a new hand to casino operators by amending SB533 earlier in
the week.  They halved (from $100 to $50M)
a fee imposed by their Policy Committee colleagues for Spectacle Entertainment
to consolidate Gary riverboat licenses into a major inland casino.  They also revived a competitive process for a
newly-created casino license in Terre Haute (which had been earmarked for
Spectacle) and provides ‘hold harmless’ funding for the French Lick/West Baden
hotels as the competitive landscape shifts.

The bill
also legalizes (and taxes at 9.5%) sports wagering at casinos and satellite
locations (amid a continued debate over mobile betting), potentially boosting
the gaming revenue stream (now a fairly modest contributor to the general
fund).

The rest of the week: Economic development, school efficiency and more…

SB563 was also
marked up in committee and passed third reading this week, updating economic
development incentives to support high-tech growth and creating a redevelopment
tax credit to bring new investment to vacant or environmentally-compromised
properties.  The amended bill tweaks the
certified tech park statute and specified public health as a factor in choosing
qualified redevelopment sites.

Here’s a
roundup of what else got remixed, rebooted or read forward in the process:

• HB1003 was
  finally called – and passed – third reading; the bill creates efficiency ratios
  for school corporations, now requiring improvement plans from districts that
  don’t devote 85% of its state funding to instructional expenses (like teacher
  compensation);
• HB1641 passed
  the Education Committee on Wednesday – it limits lease window under the ‘$1’
  charter facility law but keeps existing public debt with the public school
  corporation, potentially complicating IPS efforts to maximize the market value
  of unused properties like the former Broad Ripple High School;
• HB1008 (Teacher
  Career Ladders) passed third reading;
• HB1628,
  expanding the ‘On My Way Pre-K’ program statewide, was engrossed on second
  reading with minor floor amendments;
• HB1114, amended
  to deal with juvenile criminal sentencing, passed third reading and goes back
  to the House, where the author has dissented to refocus the bill on law
  enforcement protection issues;
• SB566 also
  passed second reading – the bill creates residential tax increment financing
  districts; of note, a previous restriction on the tool to counties with a
  population of 100,000+ was removed in committee;
• One truism of the legislature – government
  reform is never easy: HB1177 (requiring townships to adopt a capital improvement plan
  to spend persistent surpluses) passed third reading but heads to conference
  committee after the House dissented from Senate amendments;
• SB322 passed
  third reading and returns to the Senate, dealing with online sales taxes on
  third-party hotel booking sites and market facilitators;
• SB565 – amended
  last week to include “investment hub” regional development language – also
  passed third reading, keeping the discussion going on regional revenue and
  investment capacity.