Against the backdrop of a global pandemic and its economic fallout, and a period of racial reckoning, the 2021 session of the Indiana General Assembly was unlike any on record. Yet, despite a challenging climate of physical distancing and partisan divides, the Indy Chamber Business Advocacy Team was pleased to log several significant victories for its legislative priorities—thanks to the strong support from members – as the legislature found common ground on some key issues and benefitted from some unexpected fiscal gains.

This Wrap-Up will report the wins, losses, and a few “ties” where we believe more could be done—all while delivering insight into the discussions and debates along the way.

(Good) Wins….

Economic Resilience & COVID-19 Response:

• Employer Liability Protections: Two COVID-19 liability protection bills sailed through the legislature, along with other proposals to support small businesses recovery, maintain public education funding, and prevent pandemic-related learning loss:

  • SB1 provides civil immunity for private entities except in cases of gross negligence or willful misconduct. The Chamber views this a significant win for preventing frivolous lawsuit and the economy back on track.
  • SB 4 strengthens COVID liability protections for healthcare and higher education institutions.

• Small Business Restart Grant Program: The budget allocated $60 million (using federal stimulus) to the Hoosier Hospitality Small Business Restart Grant Program to help small Hoosier businesses get back on their feet through the pandemic.
• Hold Harmless: SB 2 and HB1003 address the definition of virtual education for schools that shifted from in-person to remote learning in response to COVID (we support this ‘hold harmless’ provision to avoid unwarranted funding cuts driven by public health precautions).
• Educational Support: HB1008 creates a $150 million Student Learning Recovery Grant Program and Fund to combat learning losses through COVID through non-profit partnerships.

Transit:  Ensure workforce access to reliable public transit by holding harmless from funding cuts transit providers with low ridership due to COVID-19.

• The Transit Drives Indy coalition rallied to stop two significant threats to improved transit service in Marion County.

  • SB141 proposed a retroactive rule change to state’s approach to what funds would count towards the “nontax” fundraising requirement on IndyGo. These late-coming changes would likely have threatened the planned transit expansion.
  • Transit foes also proposed an amendment to an unrelated bill, HB1191, to force IndyGo to foot the bill for utility relocations required by transit expansion construction, retroactively for the Red Line project and for the forthcoming Blue and Purple lines.
  • Both maneuvers were unsuccessful, and no anti-IndyGo language advanced.

Panhandling: Success on this issue starts with new terminology – focusing on aggressive harassment as a public safety concern and setting up a framework for proper enforcement in compliance with federal requirements:

• SB218 addresses measures with township poor relief, the bill includes penalties for aggressive harassment and trespassing, addressing a shared concern of downtown dwellers, visitors, workers, and employers

Service Enhancement:  Support increased levels of service to homeless populations including a comprehensive approach to establish low-barrier shelters and wraparound service treatment models.

• Low-Barrier Shelter Taskforce: SB218 also creates a state-local study committee focused on creating a low-barrier homeless shelter capacity and community-based programs (like Haven for Hope) for the homeless in Marion County

Community Redevelopment & Investment

Housing:  Despite controversy over state preemption of local control on housing policy, session did produce positive results for encouraging attainable workforce housing development. While proposals on state-level analogues for federal LIHTC credits did not advance, SB214 did reinstate property tax credits for acquisition, rehabilitation, or construction of low-income housing units.

Regional Cities Initiative: Promote regional cooperation and strategic quality of life investments through the Indiana Economic Development Corporation’s (IEDC) Regional Cities Initiative (RCI), increasing funding for technical assistance and planning grants for regional development authorities:

• The current Regional Cities structure was ultimately replaced with an even more robust investment in regional growth plans, originally proposed in Governor Holcomb’s State of the State and boosted by the influx of federal funding from the American Rescue Plan;
• The new Regional Economic Acceleration and Development Initiative (READI) allocates $500 million – up from $150 million – to support regional planning and projects to spur population and economic growth;
• READI is similar to the 2016 Regional Cities Initiative, but will fund a wider array of initiatives (beyond capital-intensive projects) focused on talent and innovation and cover more of the state, with $50 million grants to 8-10 multi-county regions the most likely scenario;
• We’re optimistic that Central Indiana’s current economic planning effort (led by our Metropolitan Planning Organization, building on the Chamber’s work on ‘Accelerate Indy’) gives us a head-start on this opportunity.

Food Access & Insecurity: The Cook Group was successful in its advocacy for $600,000 to support a Food Empowerment Pilot Project that is set to address a known food desert on the northeast side – an area already seeing positive momentum in housing redevelopment and multi-modal transportation connectivity.

By providing the means to acquire local equipment for training connected to the operation of a retail grocery store in low-income areas, this project is seen as a potential model for redeveloping grocery stores as entrepreneurship engines in communities throughout Indiana.

Education:

• School Funding: Nearly $19 billion of the $37.4 billion spent over two years goes to K-12, which gets a $1.9 billion increase using 2021 as the baseline.
• Complexity Index: Protect the Complexity Index as an essential tool for improving school outcomes by allocating adequate resources to schools educating challenged students – the final budget is a “win” (though plenty of work on funding and educational equity remains):

  • Complexity aid to students in poverty got a $100 per student bump (from $3,675 to $3,775) – roughly splitting the difference between the House and Senate again – while larger increases to special education and English Language Learner (ELL) grants ($210 million over the initial funding formula) also support districts serving large numbers of at-risk student;
  • According to the final funding model, for example, IPS receives more than a 4% increase in total funding per student in both years of the budget, versus a starting point (0.5% in 2022 and 1.2% in 2023), and closer to statewide average because of a more favorable formula on complexity, special ed and ELL.

• Choice School Funding: HB1005  establishes the Indiana Education Savings Account Program for students requiring special education, in the foster care program or with a parent in the military – this language was moved into the budget, along with an income-based expansion of Indiana’s educational choice scholarship program
• Teacher Pay: the budget also directs school districts to use at least 45% of their state tuition support (per-student funding) for teacher compensation – IPS is currently slightly below this ratio, raising the stakes for efficiency measures that push more money to the classroom.

Workforce:

• Career Accelerator Fund: The budget appropriated $75 million to jump-start this fund to incentivize short-term education and training programs that lead to high-wage, high-demand jobs (focused on 1–2-year degrees and certificates);
• Manufacturing Readiness Grants: The budget allocated $10 million per year to support these grants, focused on competitiveness in the state’s largest economic sector.
• The existing Next Level Jobs program – with its companion Employer Training Grants – was also fully-funded in the budget, supporting the Indy Chamber’s goal of a more employer-driven workforce development system.

Smart Justice Reforms

Policing:

• Training/Accountability: HB1006, the bipartisan police reform bill has now passed the Criminal Code and Ways & Means Committees and is ready for a verdict on the House floor; the bill limits the use of chokeholds (unless officers are confronted by deadly force), provides de-escalation training, penalizes officers who intentionally tamper with body cameras and establishes procedures to decertify and track officers guilty of misconduct
• The budget addressed some of the training supports we advocated for and ensured that funding was available for equipment that provides the community measures of accountability for law enforcement officers.  The Chamber also supported the appropriation for Indiana Crime Guns Task Force geared at removing illegal guns out of Hoosier communities.

Relevant law enforcement budget appropriations include:

• $70 M to the Indiana Law Enforcement Academy (ILEA) modernize and enhance state training facility
• $10 M grant program from federal stimulus dollars to ensure body camera for local law enforcement.
• $20M federal stimulus dollars for the Indiana State Police (ISP) to purchase body cameras
• $3M annually to expand High Tech Crimes Unit
• $1M annually to create the Internet Crimes Against Children Fund
• $5M annually to fund the Indiana Crime Guns Task Force

State Administrative Takeover/Civilian Oversight & General Orders Board:

After national and local protests for racial justice demanding police reform, the Indianapolis City-County Council made a commitment to citizen-led general orders board to create local law enforcement police (first of its kind).  The local response caused legislators to draft several bills undermining local control by the Indianapolis Mayor and City-County Council.  Thankfully the Chamber and coalition of advocates successfully defeated multiple bills aimed at reversing local oversight of law enforcement:

• SB168 would have replaced mayoral control and local oversight of the Indianapolis Metropolitan Police Department (IMPD) with a state-run committee (including the Indianapolis mayor, who would be outnumbered 4-1 by gubernatorial appointees).
• HB1427 and SB394 would have voided the Marion County General Orders Board, mandating that police department administration be under the authority of the chief of police or town board of metropolitan policy commissioners.

Defense against Charitable Bail: HB1376 The Chamber and advocates successfully blocked a Charitable bail bill geared at blocking a nonprofit organization from paying bail for a defendant.  This bill didn’t receive a hearing.  It is important to the business community that Hoosiers are not denied bail for their inability to pay and subsequently lose their job.  Our advocacy is based on the disruption to our workforce by potentially removing an employee who hasn’t been proven guilty. (the Chamber opposed this piece of legislation as drafted, as it made it more difficult for organizations to post bail for multiple individuals)

Hoosier Health: Medicaid is fully funded in the next budget, though lawmakers did not take steps to control the growth of Medicaid by reducing smoking rates (more on this follows); the final budget plan also restores full mental health funding and adds another $100 million for mental health initiatives, significant progress in tandem with other modest gains: 

• Public Health: HB1007 creates a Department of Health grant program for prevention, addressing health issues and challenges. The final budget set aside $50 million for the public health challenges grant program created by HB1007.
• Telehealth: SB3 adjusts Medicaid reimbursement rules to allow telehealth in more instances and enshrines in statute many of the flexibility measures allowed during the pandemic. These changes will go a long way in expanding access to preventative healthcare and underscore the importance of access to internet connectivity throughout the state.
• TANF Program: Increases the state earned income tax credit to an amount equal to 10% (instead of 9%) of the federal earned income tax credit that an individual claimed for a taxable year. Provides that for purposes of the Temporary Assistance for Needy Families program, income earned by a certain individual in the household who is participating in or pursuing a postsecondary degree, a workforce certificate, a pre-apprenticeship, or an apprenticeship may not disqualify an eligible household from receiving benefits and may not be considered in determining the amount of assistance.
• This year’s Department of Health agency bill, HB1203 was signed into law; among other provisions, it extends local authority to enact clean needle exchange programs through 2026, to avoid compounding the related health issues spawned by drug abuse without such programs. Allows the state to release data to a nonprofit when its determined necessary as part of a response to an outbreak, epidemic or pandemic.
• SB10 creates a Statewide Maternal Mortality Review Committee to study maternal health and hopefully its work will highlight the shortcomings of inaction of not passing a meaningful Pregnancy Accommodations bill.

Farms to the City: Crossing public health with economic development, HB1283 passed to allow the creation “urban agriculture zones” exempt from property tax to incentivize farming in urbanized areas.