Those of us who spend our winter days roaming the halls of the Statehouse look forward to session’s halfway mark – when viable bills cross chambers, accompanied by a short respite in legislative activity – with great anticipation. The same anticipation, say, as Bad Bunny fans awaiting his Sunday Super Bowl halftime show.
But like the special effects that tend to adorn those halftime shows, this year’s Statehouse break is merely a mirage.
Bills are moving with such speed and ferocity that this week’s legislative halftime brought no slowing of activity nor break in debate. Thankfully for our Legislative Update subscribers, that means we have plenty of pre-reading to offer you before Sunday’s big game (or big concert, ads bonanza, or snack buffet, depending on your interests).
Find your favorite spot on the sofa to read this week’s play-by-play and warm up that perch for your Sunday afternoon viewing.
In today’s Legislative Update:
- Get in Formation (Legislative Mechanics)
- NFL vs. Teams (State vs. Local Control: Housing Edition)
- Playing Under the Cap (Fiscal Issues)
- Signing Bonus (Regional Economic Development)
Get in Formation
You’ll notice a legislative trend this week that’s almost as obvious as the many celebrity cameos slated for this year’s Super Bowl ads. The key elements from bills that died before halftime are being resurrected into omnibus bills. We’ll talk about two of those mega-bills – HB 1210 (the fiscal issues bill) and SB 281 (the regional economic development bill) in more detail.
🏠 But first, let’s catch up on the housing debate.
NFL vs. Teams
HB 1001 – Republican Rep. Doug Miller’s pro-housing supply legislation – is generating a debate spicier than our favorite Super Bowl chicken wings. At the heart of the issue is a common theme: local autonomy versus state control.
⬆️ The Upshot: As a reminder, the bill aims to make it easier—and more predictable—to build new homes, while adding transparency around local housing outcomes. The bill nudges local zoning to better match adopted comprehensive plans. Starting in 2027, if a city or town updates its plan but doesn’t bring zoning into alignment within a year, proposed projects would be approved if they comply with either the plan or the zoning code – a move designed to keep projects moving. The bill also puts guardrails on local fees and expands where housing can be built by default. Most affordable housing developments would be allowed to be built “by right” on property owned by religious institutions. And unless a community opts out by ordinance, the bill sets statewide “default” zoning rules that limit parking minimums and restrict overly large lot-sizes, density, and site standards—changes designed to lower costs and increase supply.
💬 The Debate: Local elected officials are pushing back against the bill. In an IndyStar op-ed published this week, more than three dozen Central Indiana mayors, town managers, county commissioners, and council presidents called HB 1001 “a one-size-fits-all mandate that treats local planning as the problem to be solved.” They argue that the state is exerting too much control over what should be a local process with lots of public input. While affordable housing is a problem that needs to be addressed, they say the answer is reforming permitting, investing in local infrastructure in growing communities, and setting and rewarding production targets.
🏈 For NFL skeptics who think teams need more autonomy to innovate, this local control argument will resonate (revenue sharing, amirite?).
But others assert, to the contrary, the state needs to intervene if we’re going to take meaningful steps toward solving the housing crisis. In another Star piece, urban planner and Downtown Indianapolis resident Jeffrey Tompkins argued that local zoning regulations have become too burdensome in restricting the type of housing we can build and the supply of housing available, which limits supply and increases prices. He calls HB 1001 “the abundance agenda Indiana needs,” noting that it not only eliminates unnecessary red tape – for example, stringent requirements with adding accessory dwelling units – it also increases transparency by requiring locals to opt out of more relaxed designed standards, parking requirements, and lot sizes – which also means they must explain their position.
➡️ What’s Next: The bill has been referred to the Senate Judiciary Committee.
Playing Under the Cap
Speaking of local governments’ frustration with the state, remember SEA 1? Last year’s property tax reform legislation will reduce the tax burden for homeowners while also decreasing property tax revenue for local governments. However, to offset some of that lost revenue, the bill also shifts part of the local tax burden from property taxes to local income taxes (LIT). It raises the county LIT expenditure cap to 2.9%, allows larger cities and towns to adopt their own LIT rates, and restructures how LIT is shared among counties, municipalities, and other local units. This gives locals more tools to replace revenue, but it also sets up difficult local decisions about income tax increases and how revenue is divided.
🎯 Enter HB 1210, which, among other things, attempts to clean up some of the quirks that accompanied SEA 1. Here is what the bill, authored by Republican Rep. Craig Snow, does, in four plays:
- SEA 1 Fixes: It delays the LIT changes in SEA 1 from going into effect from 2028 to 2029. Importantly, it also guarantees that if a municipality does not renew its LIT rate each year, the rate will automatically default to what’s needed to cover debt service.
- Tourism Improvement District: The bill also enables local governments to create Tourism Improvement Districts, which capture fees from businesses to support marketing and promotion of tourism in the surrounding area. Creating these districts would require a petition, hearing, and local ordinance, and as with their kindred spirits, Economic Improvement or Enhancement Districts, apartments and homesteads would be excluded from the fees.
- 🏈 Chamber member fan favorite? We heard directly from some members in our policy survey about the need for these districts and their importance to Indy, so we know at least some of you will be cheering on this development with us. Go team!
- Restrictions on Restrictions: Both Fishers and Carmel have passed ordinances capping rental properties to 10% of neighborhood homes and requiring rental property owners to get city permits to rent. These policies are aimed at limiting the presence of large, out-of-state investors in these communities, but critics say they limit accessibility and affordable housing. HB 1210 would pre-empt local communities from being able to put those restrictions in place.
- DLGF Requirements: Our legislative agenda included an ask that the legislature require the state’s Department of Local Government Finance to annually update the cost tables that assessors use to determine assessed valuations on which property taxes are based. To date, the bill does not contain this provision.
Signing Bonus
SB 281 has become the vehicle for a slate of provisions to fuel regional economic development. Authored by Republican Sens. Greg Goode and Ryan Mishler and Democratic Sen. David Niezgodski, the bill puts more structure, accountability, and resources behind regional economic development, while giving the state flexibility to support large, high-impact projects that span multiple communities.
🖼️ Big Picture: The bill authorizes the Indiana Economic Development Corporation (IEDC) to award up to $50 million per fiscal year in redevelopment tax credits for projects that align with approved regional development plans and have a recommendation from a regional development authority (RDA). Importantly, it also:
- Defines who qualifies as a “development authority.” RDAs – like our own Central Indiana Regional Development Authority (CIRDA) – are explicitly eligible. The bill also requires regional development plans to be more detailed, laying out the region’s overall economic strategy, a list of priority projects, expected returns on investment, and how local governments and partners are expected to participate.
- In addition, the bill allows a development authority to create a regional development advisory council, with members appointed by county executives, the Governor, legislative leaders, and mayors—ensuring both state-level and local voices are represented. These bodies aren’t currently charged with an explicit scope in the bill.
- SB 281 gives the State Budget Agency flexibility to increase funding for the Deal Closing Fund – an economic development tool created in 2023 designed to attract high-impact businesses to the state. That increase would be subject to Budget Committee review, with the goal of helping Indiana stay competitive when closing major economic development deals. In the words of Cuba Gooding Jr., Show Me the Money! (We couldn’t resist.)
That’s all for this week’s update. Keep following along to see if our legislative predictions are more on point than our Grammy picks were last week.
As for the outcome of Sunday’s game? As Colts fans, we can borrow the words of Tom Brady and say we don’t have a dog in the fight. Hopefully, our take will land with less controversy.
Until next week.
We’re whistling while we work these days, and it’s not just because the Grammy Awards are Sunday. Next week at the Statehouse, viable bills will play musical chairs in the Legislature, with House-originated bills that have passed the House moving to the Senate, and vice-versa.
While many of most-watched bills already made the cut this week, some are still facing their last hearings on Monday. We don’t know which will be more suspenseful: the final moments until these proposals make it to the other chamber, or the nail-biting seconds before Album of the Year is awarded. (💡POV: Close contest between Kendrick Lamar and Lady Gaga)
Whatever the outcomes are on both fronts, we hope they start your week on a high note.
Read on for this week’s songbook and find our curated playlist of corresponding tunes at the end of this update for your listening enjoyment.
- Go Your Own Way (K-12 Education)
- We Can Work It Out (Public Camping Compromise)
- Don’t Stop Believin’ (Employer Liability)
- I Want You to Want Me (Tax Credit Expansion)
- Against the Wind (Syringe Exchange Continuance)
- Team (Canadian Partnership Resolutions)
- Purple Rain (A Word on Minneapolis)
Go Your Own Way
Lawmakers supporting Republican Rep. Bob Behning’s HB 1423 are seeking to create a more unified, efficient system of schools within Indianapolis Public Schools (IPS) boundaries under a new entity called the Indianapolis Public Education Corporation (IPEC). Based on amendments that passed Thursday, they also want to carve out exceptions for charter schools that lease or own their buildings and want to go their own way. However, there’s a large carrot for charters that do enable their facilities to fall under the purview of IPEC: they gain access to public funding for capital projects and debt service, from which they have historically been excluded. Complicating matters is the fact that some charter schools, which historically have lacked access to funding for facilities, have financed their buildings with private dollars, so there’s nuance around whether those privately funded assets could fall under IPEC control.
The bill saw other clarifying changes, including:
- I Need a Dollar: The state’s so-called “dollar law,” which requires districts to offer their unused buildings to charter schools for $1, was repealed for the IPS district as part of the legislation.
- Bills, Bills, Bills: There’s also clarifying language stating that any debt IPS incurred before April 2026 would remain an obligation of the district. This is a positive move for bondholder certainty, and we believe additional financial details will be finalized during the bill’s third reading on Monday.
- It’s My Party: Finally, amendments made clear that, in the case of charter schools, the ability to enforce a shared performance framework for charter and district-run schools rests with charter authorizers, not IPEC. However, the bill gives IPEC the ability to appeal to the State Board of Education if the authorizer is not implementing the framework with fidelity.
👀We’ll be watching on Mon., Feb. 2, as the bill receives its third and final reading in the House, where it must pass before moving to the Senate.
We Can Work It Out
The debate over the controversial SB 285, Sens. Cyndi Carrasco’s and Eric Koch’s effort to regulate public camping, offers a glimmer of hope for fans of good, old-fashioned compromise. An amendment that passed last week would position the bill to be a better vehicle for getting those in need of housing and other supports access to services, including through partnerships such as Streets to Home Indy
- ⬆️The Upshot: A new provision would make it so that cities or towns could enact local ordinances giving a person in violation of the ban on public camping 48 hours from the time of citation to either move or engage with supportive services. If the person in violation does not take action, they would still be subject to a Class C misdemeanor.
- 👮The Amendment Also: Makes the bill less of a Beast of Burden on local police. Rather than requiring officers to transport individuals – who may have personal belongings with them – the responsibility shifts to service providers and other partners who are better equipped to help with transport.
- 👍The Chamber Supports changes that help unhoused individuals get access to services. As champions of Streets to Home Indy, we think the recent amendment makes for better policy to enhance that program’s impact.
- 🎵In a Song: The amendments move this bill closer to The Middle (Jimmy Eat World)
Don’t Stop Believin’
HB 1098– Rep. Matt Commons’ bill to clarify liability protections for employers who hire workers under 18 – will make its way to the Senate. The bill wants to help employers Believe that by hiring high school students to participate in apprenticeship programs that prepare them for in-demand jobs, they’re not only doing right by the next generation, but they’re also making a smart decision for their bottom line and helping the state’s workforce.
Recent amendments helped clarify that workers’ compensation insurance provides the exclusive avenue for remedy for onsite workplace injuries, whether for minors or adults. Employers and the intermediaries that help oversee these work-based learning initiatives would be left to determine the details of who is going to be on point for workers’ comp.
🤔 Indy Chamber’s Take: We’re singing Pharell’s Happy to these changes, which we hope will give employers confidence to engage in these critical workforce development and skill-building apprenticeship programs, while not saddling intermediaries with too great a liability burden.
🎉We’ll be ready to Jump Around if the bill passes the Senate and is signed into law.
I Want You to Want Me
Indiana knows how important it is for companies to get talent to move to the state and stay. SB 264, which passed the Senate and moves to the House, is focused on leveling up Indiana’s gravitational pull.
Authored by Sens. Brian Buchanan and Linda Rogers, the bill makes the state’s EDGE tax credits a more competitive tool for employers seeking to attract and retain talent. The bill allows the Indiana Economic Development Corporation (IEDC) to boost the value of an EDGE credit when a company incurs relocation costs to bring a worker to Indiana for a new job. It also makes clear that companies can qualify for EDGE credits for retaining employees, not just creating new jobs, if they increase an employee’s hourly wage by at least 25%.
But will money on the table beat out a Love Song as a way to attract workers? Let’s be honest, probably. 🥰
Against the Wind
Syringe exchange programs in Indiana and nationally have proven to help those using intravenous drugs engage with supportive services, including disease testing, addiction treatment programs, and wraparound assistance like housing and food. Yet historically, they have faced pushback in some corners due to unfounded fears that such programs might encourage substance use. Nonetheless, in Indiana, this research-backed approach has persisted since the state’s original syringe exchange law passed in 2015. This year, SB 91, which moves to the House, delivers a major win for syringe exchange programs and the people they help.
Authored by Sens. Michael Crider, Ed Charbonneau, and Brett Clark, with a bipartisan list of co-authors, the bill extends the supporting legislation for Indiana’s 1:1 syringe exchange program, which was set to expire in July, through 2036. Talk about an encore. 👏
🏆And the Grammy Goes to: Sen. Michael Crider, who has been a tireless and tenacious champion of syringe-exchange programs. We owe him a debt of gratitude for his principled, dedicated efforts to pass this year’s extension.
Team
Turn up your Celine Dion (or, if she’s not your jam, try Drake, Shania Twain, or Justin Bieber). These Canadian superstars’ tunes offer a soundtrack to our joy over a recent trio of Senate- adopted resolutions reaffirming Indiana’s strong and growing partnerships with the provinces of Alberta (SJ 7), Quebec (SJ 8), and Ontario (SJ 9).
What this means: Canada remains one of Indiana’s top trading partners, and these resolutions, introduced by Sen. Eric Koch in his role as Utilities Chair, underscore the depth of collaboration already underway across energy, technology, agriculture, and space.
At a moment of uncertainty in the broader international trade climate, these resolutions demonstrate that subnational relationships can continue to thrive. They also lay the groundwork for an even more robust Indiana-Canada partnership in the years ahead.
Purple Rain
Our hearts go out to the people of Minneapolis, which has experienced dramatic unrest amidst the fatal shootings of two of its residents by immigration enforcement officers over the last month. The late legendary artist Prince, a Minneapolis native, captures the sorrow of the moment well with his lyric: “Sometimes It Snows in April.”
Earlier this week, more than 60 CEOs of Minnesota-based companies signed a joint letter posted on the Minnesota Chamber of Commerce’s website calling for a de-escalation of violence and imploring local, state, and federal leaders to collaborate on solutions.
🏠What this means at home: In Indiana, a slew of immigration bills have been debated this session that would double down on enforcement mechanisms, including some implicating employers (see SB 122, HB 1039, and SB 87). We remain optimistic that Indiana can continue to be a place of nonviolence and a model for handling policy disagreements peacefully. Joining our Minnesota colleagues, we urge collaboration toward peaceful solutions on immigration issues and a principled commitment to the rule of law.
🎤We don’t want to end on a somber note. While things may feel heavy in the world (not to mention frozen, given the weather), remember that life is always better with music playing in the background. On that note, enjoy this curated playlist capturing the songs mentioned in today’s update. We’ll see you next week.
As we experience the descent of a wintry blast that threatens to make Indiana feel like a scene from Frozen, we’re grateful to be hunkered down at the Statehouse, watching the red-hot action of a busy legislative session.
Conversations around some bills have cooled this week (See the public camping bill, SB 285, which passed out of committee on Jan. 14 and is awaiting a full House hearing). But the topic of affordability continues to be on fire, with meaningful progress on bills related to bringing down the cost of housing and utility bills. Legislation regarding the management of facilities, transportation, and accountability for schools within Indianapolis Public Schools boundaries also continues to be a hot topic.
Bundle up and get cozy! There’s no better fireside reading than a legislative missive. Here’s this week’s forecast:
- Easing the Housing Freeze (Housing Matters)
- Many Burning Questions (K-12 Education)
- Turning Down the Heat (Electric Utilities)
- Fueling the Talent Fire (Workforce + Economic Development)
- Cooling Oversight (Civilian Oversight Boards)
- Controlled Burn (Education Cleanup)
Easing the Housing Freeze
House Republicans advanced their priority housing bill, HB 1001, out of the House Local Government Committee this week on a 7-3 vote. Authored by Republican Rep. Doug Miller, the bill is aimed at expanding housing supply and improving homeownership affordability by easing certain local zoning and development rules. The version that moved forward reflects amendments made in response to feedback from local governments and stakeholders, including revisions related to duplexes, accessory dwelling units, and impact fees.
The bill drew broad support from housing and economic development advocates, including the American Institute of Architects, the Indiana Housing and Community Development Authority, and United Way of Central Indiana, all of whom pointed to Indiana’s ongoing housing shortage and the need to reduce barriers to new construction. Some local officials, however, raised concerns about the bill’s impact on local control and infrastructure funding, arguing that limits on impact fees could shift costs to future residents. While some committee members signaled they want additional clarity as the bill moves forward, HB 1001 now heads to the House floor.
Many Burning Questions
HB 1423 is Republican Rep. Bob Behning’s proposal to create a new, mayor-appointed Indianapolis Public Education Corporation (IPEC) to manage facilities, transportation, and systemwide accountability across schools within Indianapolis Public Schools (IPS) boundaries. The Chamber continues to support the creation of IPEC to create a more cohesive and efficient system of schools that serves all students within IPS boundaries well and ensures fair access to transportation and facilities, regardless of whether students attend district-run, public charter, or innovation schools.
Following action in the House Education Committee, the bill now includes amendments that strengthen financial clarity and answer timeline questions, with a two-year ramp-up window before the IPEC begins management and operational duties in the 2028-29 school year. The changes adopted also set up a more consequential debate next week as the bill heads to the House Ways & Means Committee. Key topics center around how finances flow with the new corporation in place – and what dollars and obligations remain with schools that would be under IPEC oversight. (Warning: this gets wonky fast.)
- 💰Legacy school debt stays put: A key improvement aligns closely with the Indy Chamber’s position: all existing bond obligations remain with their original issuers – whether IPS or public charter schools – and bondholder rights are unchanged. This avoids creating a new or ambiguous “successor obligor” by shifting debt to the IPEC, which could have unsettled capital markets. From a credit and taxpayer perspective, maintaining continuity for existing debt is the most stable and market-friendly approach, and a meaningful step forward for the bill.
- 💸There’s clarity around tax distributions: The bill preserves current property-tax distribution formulas, so revenues will continue to flow to IPS and public charter schools via the county auditor. It also creates a new fund, capped at up to 3% of property tax revenues, to provide operations dollars for IPEC. While this makes sense logistically, we have questions about the implications for financial oversight and transparency. It will be arduous for taxpayers and employers to monitor the finances of dozens of individual schools and IPS. If IPEC has responsibility for accountability and oversight of schools, but no centralized financial controls, that also could create ambiguity.
- ❓Questions remain about “pledgability:” Another concern is cash flow for IPEC. If the entity is expected to issue debt for facilities improvements, bond markets typically require guaranteed, first access to at least the minimum amount of revenues required to service debt through a dedicated mechanism (such as a debt-service levy). Without this, investors and rating agencies are likely to view the corporation’s ability to repay debt as uncertain, even if the corporation has broad governance responsibilities.
- 💡One solution might be: Bond counsel has flagged that if lawmakers intend IPEC to issue debt, the statute could mirror Indiana school corporation financing norms. This might involve explicitly including IPEC in the state intercept remedy – a widely understood credit backstop – or utilizing bond pathways that school corporations already use. Such options could increase market confidence.
- ⏭️ What’s next: The House Ways & Means Committee is expected to take up these financing and revenue-flow questions. The key issue will be whether HB 1423 ultimately includes the market-ready guardrails needed to match the corporation’s responsibilities with dependable financial tools – clear authority, transparent cash flows, and proven financing mechanisms.
🤔 Indy Chamber’s Take: We view the Education Committee amendments as real progress and will continue to focus on ensuring that any new governance structure delivers stability, transparency, and public trust, while avoiding unnecessary financial risk for taxpayers.
Turning Down the Heat
A major bill aimed at making electric bills more predictable and fairer for Hoosiers has been revised and advanced to the full Indiana House after committee action. Lawmakers on Tuesday updated the proposal, authored by Republican Rep. Alaina Shonkwiler, with changes expected to improve clarity and consumer protections as it moves forward.
One of the key changes reflects input from legislators on both sides of the aisle: updating the terminology for “budget billing” to “levelized billing,” which lawmakers see as clearer and more direct. Utility customers would pay consistent monthly amounts based on their historical energy use, rather than seeing big swings in bills, and would settle up no more than twice annually to reflect spikes in energy use.
Under another change, utilities would also fund assistance programs for income-qualifying Hoosiers from 0.2% of their residential electric revenue, rather than through existing energy assistance dollars collected from ratepayers.
A House committee unanimously approved the bill, sending it to the House floor for further consideration.
🖼️The big picture: The bill ties into broader affordability concerns at the Statehouse, as utility costs have been rising sharply and become a top issue for many households. Proponents argue that creating more consistent billing, protecting income-eligible customers from disconnections during extreme heat, and building low-income assistance programs will help families manage costs. While generally supportive of affordability goals, some lawmakers may push for additional consumer safeguards as the bill advances.
Fueling the Talent Fire
We believe talent is the key to our region’s growth and economic vitality. To that end, the Indy Chamber supports efforts to enable high school and adult learners to get paid, on-the-job experience to help them learn while working, and build our region’s talent pipeline. For these efforts to succeed, we need clear guidelines in place to address employers’ workplace liability concerns related to employing youth under 18. HB 1098, authored by Republican Rep. Matt Commons, takes a step toward addressing these liability concerns.
In its original draft, which we told you about two updates ago, the bill aimed to reduce uncertainty by clearly assigning liability when a student is placed with an employer through a talent intermediary. It put primary responsibility for legal and administrative claims on the intermediary, rather than leaving roles ambiguous. Recent amendments clarify both the benefits and protections students qualify for and the division of responsibilities between employers and intermediaries.
- Under new amendments, the bill now requires an employer and an intermediary to enter into a written agreement spelling out their respective duties when placing a student in a work-based learning program.
- It also repeals outdated references to the federal School-to-Work Opportunities Act and explicitly states that, with certain limits, students in these work-based learning programs are eligible for workers’ compensation and occupational disease benefits when they are performing services for an employer.
- It also protects employers from insurance discrimination by prohibiting insurers from denying coverage, canceling policies, or charging higher rates simply because a worker is under 18 or enrolled in a work-based learning program.
🤔 Indy Chamber’s Take: We believe the amendments mark progress, but we still advocate for employers to maintain liability, with clear protections, such as a statutory safe harbor, to provide them peace of mind and confidence to engage.
🏥Meanwhile, in the healthcare workforce…
HB 1278 aims to help address Indiana’s nursing shortage by loosening restrictions on colleges and universities that train nurses, allowing more institutions to expand or start nursing programs. Supporters say the change would increase the pipeline of qualified nursing graduates and help meet growing workforce demand.
👏The bill drew broad support from nursing schools, healthcare advocates, and workforce groups, including the Indiana Nurses Association. Proponents argue the bill could also help reduce healthcare costs by easing staffing shortages. The amended bill passed committee unanimously and will move to the full House.
💲And on the tax credit side…
SB 264, authored by Republican Sens. Brian Buchanan and Linda Rogers, updates Indiana’s EDGE tax credit to give the state more flexibility to attract and keep talent. It allows the Indiana Economic Development Corporation (IEDC) to boost the value of an EDGE credit when a company incurs relocation costs to bring a worker to Indiana for a new job. And it makes clear that companies can also qualify for EDGE credits for retaining employees, not just creating new jobs, if they increase an employee’s hourly wage by at least 25%.
The bill passed out of committee last week and now moves to the full House.
Cooling Oversight
The Indianapolis City-County Council created a General Orders Board in 2020 with authority to approve policies on how the Indianapolis Metropolitan Police Department (IMPD) officers conduct themselves, including the use of force. Indianapolis’ civilian-led board is among many policing reforms implemented across the U.S. following the 2020 murder of George Floyd by police force in Minneapolis.
Council Republicans have advocated to rein in the authority of the Board, noting that challenges with making quorum for meetings have stalled decisions and hampered the department’s ability to approve policies. Council Democrats have rejected those efforts.
SB 284, authored by Republican Sen. Cyndi Carrasco, would limit the authority of any civilian oversight board or commission created by a city, county, or township in Indiana to oversee a law enforcement agency to advisory only – meaning they cannot make binding decisions. These boards would be allowed to review, recommend, and provide input, but final authority would remain with the law enforcement agency itself. The bill explicitly excludes merit boards and commissions, which already have defined statutory authority. SB 284 passed out of committee and heads to the House.
🤔 Indy Chamber’s Take: Public safety is among the most important issues affecting our city. We need to create optimal conditions for IMPD to enforce safety and build trust with the community – and we also need to ensure the department can attract and retain top talent. The Chamber was an early supporter of the creation of the General Orders board — we are looking for opportunities to preserve civilian input in policing policy while ensuring that the GO board runs optimally.
Controlled Burn
HB 1004, authored by Republican Rep. Bob Behning, is a wide-ranging education clean-up bill that updates, consolidates, and eliminates dozens of education statutes across K-12 and higher education. Among many other provisions, it would change requirements around curriculum and graduation and ease teacher licensing rules. With recent amendments, the bill would allow school boards to hold meetings in different school district boundaries, align the number of absent days with current law, and ensure dating violence education in schools. It passed out of committee and heads to the full house.
Thank you for reading this week. Remember, while the action is moving fast, things are just warming up at the Statehouse. We hope that by the time of next week’s update, the thermostat will follow suit.
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Legislative Update: 4.25.25
The 2025 legislative session ended a smidge ahead of schedule, with work wrapping up during the early hours of Friday, April 25 (for those who read their email promptly: today). This capped a dynamic four months that started with a boatload of bills; included many substantive debates over issues like taxation, education, and health policy; and concluded with major budget negotiations – and programmatic cuts – to resolve a $2.4 million shortfall in projected revenue over the next biennium. We’re summarizing it for you in three parts.
Warning: Today’s missive is long, but we’ve aimed to make things as skim-worthy as possible with lots of bullets and headlines.
The Big Wins: Indy Chamber Legislative Priorities
Road Funding Changes Offer New Revenue and Benefit Central Indiana
- What Happened: Faced with declining gas taxes and changing vehicle technology, Indiana must shore up additional funding to support state and local infrastructure. To help address this, lawmakers passed HB 1461 (Road Funding), which enables the state to request a waiver from the federal government to toll interstate highways; allocates $50 million from a state fund to Marion County beginning in 2027 if locals can match the funds; and for communities that have a wheel tax, distributes additional state dollars to them based on total lane mileage, which factors in the number of lanes and not just the length of a road.
- What It Means: Central Indiana and other growing parts of the state will benefit from these changes, which start to allocate funds based on where traffic is the heaviest and, therefore, maintenance needs are the greatest. And tolling would be a game-changer to ensure our state has the resources (now recoupable from out-of-state drivers) to remain the Crossroads of America, which is critical for business.
- What Comes Next: We’re continuing to partner with Mayor Joe Hogsett’s administration and the Indianapolis City-County Council to identify additional funding to match the $50 million from the state that kicks in starting in 2027. And just a heads up that another provision in the bill increases the speed limit to 65 miles per hour on I-465.
Indiana Raises Tobacco Taxes for the First Time Since 2007
- What Happened: In a major win for Hoosier health and economic momentum, state lawmakers supported a $2 per pack increase to Indiana’s cigarette tax and proportional increases for other forms of tobacco in HB 1001 (State Budget). This was among the Indy Chamber’s top legislative priorities, and we’re immensely grateful to all of you who reached out to your lawmakers in support.
- What It Means: The tobacco tax increases are projected to generate nearly $810 million in new revenue over the next biennium. Evidence also shows that raising the cigarette tax by $2 per pack has a meaningful impact on reducing smoking rates, with an estimated 45,000 adults projected to quit and 17,800 young people deterred from taking up smoking. The long-term economic impacts are important, too, as Medicaid expenditures are rising, and reducing smoking has a positive impact on slimming these costs.
- What Comes Next: The new tax goes into effect with the new fiscal year, which starts July 1, 2025.
New Measures Will Help Align Education and Training with Industry Needs
- What Happened: Indiana faces a workforce shortage, with over 160,000 unfilled jobs, and we’re not adding enough workers to the mix to fill the gap in coming decades. Two new laws will help align higher education and career training with the needs of industry so that we prepare more graduates with the skills needed for high-demand fields – with a focus on bolstering efforts to build a world-class professional apprenticeship system in Indiana.
- SB 365 (Education Matters) requires the Indiana Department of Education and Indiana Commission for Higher Education to track career and technical (CTE) program completion and how many students remain in their fields of concentration after graduation. The bill also creates a statewide career coaching initiative and grant fund to give students support in identifying their career paths of interest.
- SB 448 (Higher Education and Workforce Development Matters) requires Secretary of Education Dr. Katie Jenner to prepare a framework for earning “stackable credentials,” such as industry certifications, training programs, and postsecondary degrees that ladder up to mean strong competency for jobs in high-demand industries. It also requires the Management Performance Hub to annually report data related to credential supply and demand.
- What It Means: These changes build upon years of effort to increase college enrollment in Indiana while also creating pathways for career preparation and training beyond four-year degrees. SB 448, in particular, will support efforts to build a statewide apprenticeship program in Indiana, with a focus on preparing talent with the skills employers in high-demand fields require, starting in high school.
- What Comes Next: Secretary Jenner’s framework must be completed by Nov. 1, 2025.
Alliance Will Foster Collaboration and Resource-Sharing Among Schools
- What Happened: With HB 1515 (Education and Higher Education Matters), the legislature created the Indianapolis Local Education Alliance, an advisory body of Indianapolis leaders tasked with developing collaborative solutions within Indianapolis Public Schools’ (IPS) district boundaries. Indianapolis has myriad public school options for families, including public charter schools, which are run by nonprofits; district-run schools; and a hybrid approach called Innovation Network Schools, which have nonprofit operators but operate within IPS. Today, about 60% of parents send students to either public charter or Innovation Network Schools, and there’s a need for a more cohesive system, especially when it comes to governance and sharing resources for school operations. The ILEA will be charged with creating cohesion by making recommendations on facilities and transportation, identifying collaborative governance structures, and aligning on future referendum proposals, among other topics.
- What It Means: The recommendations of the board will not be binding, but they could include any structural changes required “for a collaborative system of schools that can serve all students within the geographic boundaries of the school city fairly.”
- What Comes Next: Appointments to the nine-member Alliance will be made before the group’s first meeting on July 1, 2025. Mayor Joe Hogsett will chair the board and has four appointments, including one representing the business community. The Indy Chamber has raised its hand to be part of the Alliance and hope we can represent your interests in this consequential work. As an advocacy organization representing the needs of Central Indiana’s business community – and a partner with IPS for the last two decades – we care deeply about advancing conversations around education quality and maximizing school resources in our community. Notably, our 2018 audit of IPS resources provided us with a strong grounding in IPS operations and resources, and we have been highly engaged since then on matters such as referendums and tax-sharing.
State Stands Up New Office for Entrepreneurs and Small Business
- What Happened: Small businesses are the lifeblood of Indiana’s economy, and nationally, young companies create the most net new jobs. Aligned with Gov. Mike Braun’s enhanced focus on “main street businesses,” the legislature created an office dedicated to supporting small businesses and entrepreneurs in Indiana in SB 516 (Economic Development).
What It Means: In a 2022 voter survey, small business advocacy organization Right to Start showed that while 43% of voters have considered starting a small business, only 21% have tried, signaling how daunting the task can feel. Dedicated support for this endeavor will be a win for Indiana’s business community. We hope the state also stays focused on supporting companies into the growth stage through other policy efforts.
Other Big Issues
Lawmakers Pass Lean Budget under Tight Revenue Forecast
- What Happened: HB 1001 (State Budget) made it across the finish line in the wee hours of Friday, April 25. After a $2.4 billion shortfall was identified in the state’s April revenue forecast, legislative and fiscal leaders had to make tough decisions about funding other programs in the $46.2 billion allocation over two years. Nearly half (47%) of the state’s general fund is spent on K-12 education and nearly a quarter (22%), the fastest-growing portion, is dedicated to Medicaid.

- Here’s a line-by-line look at some of the key items we were watching – and where they landed in the final budget:
- ⬇️ Public Health Funding: Initially funded at $200 million in the House and Senate passed version of the budget, funding for the Health First Indiana program for improving public health outcomes was reduced to $80 million over the biennium.
- ⬇️ Career Scholarship Accounts (CSAs): The $30 million allocated toward Career Scholarship Accounts was reduced to $10 million in the final version of the budget. CSAs provide high school students (grades 10-12) with $5,000 annually in career-based scholarship funding for work-based learning opportunities, such as apprenticeships, internships, and more.
- ↔️ Residential Infrastructure Revolving Loan Fund (RIF): Funding remains at $50M over the biennium for RIF. The fund provides low-interest loans to Indiana counties, cities, and towns to finance infrastructure projects that support residential housing development. Additional guardrails for the program can be found in HB 1005 (Housing and Building Matters).
- ⬇️ Hoosier Workforce Investment Tax Credit: Previous iterations of the budget included a tax credit meant to incentivize employers to upskill their existing workforce; however, funding for this program was not included in the final version of the budget.
- ↔️ Workforce Innovation: Lawmakers allocated $36 million toward workforce innovation, which can be used for employer training grants, workforce-ready grants, and workforce innovation programs, including the reemployment skills training pilot program.
- ↔️ Statewide Sports and Tourism Bid Fund: The Indiana Sports Corp. uses the bid fund to attract major events to the state. The budget allocates $10 million to the fund.
- ⬇️ Child Care: The final budget provides $147 million of hold-harmless funding for families currently receiving childcare through the Child Care Development Fund (CCDF). It cuts CCDF, On My Way Pre-K, the school-aged care grant, and Visually Impaired Preschool Services by roughly 5%.
- ⬆️ Universal Vouchers: Beginning July 2026, there will be no income restrictions on Hoosiers eligible to access universal vouchers to pay for private K-12 education through Indiana’s Choice Scholarship Program.
Lawmakers Pass Tax Reform Package
- What Happened: SB 1 (Local Government Finance) will usher in changes to Indiana’s taxation system, with reforms in three big buckets:
- Residential Property Tax Reductions: The bill provides homeowners with relief by phasing up the homestead deduction from the current 60% of a home’s assessed value (or $48,000, whichever is lower) to 66.7% of a home’s assessed value by 2031. It also provides all homeowners with a $300 tax credit, with additional credits for seniors, disabled homeowners, and disabled veterans.
- Business Personal Property Tax Reductions: SB 1 also gives businesses a new tax break by raising the ceiling on the value of business personal property that can receive deductions, from the current $80,000 to $2 million in 2026. It also eliminates the 30% depreciation floor, which says that for tax purposes, business property cannot be valued at less than 30% of its original value. The depreciation floor lift only applies to new property and will be phased in over time.
- Important Note: One of the final bills passed this session – HB 1427 (Department of Local Government Finance) – makes adjustments to some of the business personal property tax language passed in SB 1, including removing the BPPT changes for 2025 since property tax bills have already been sent out.
- Local Income Tax Changes: The bill provides local governments with greater ability to generate additional revenue. Cities and towns can adopt their own local income tax rates, and the cap for local income taxes at the county level will be raised from 2.5% to 2.9%.
- What It Means: Businesses benefit from this bill through changes to the business personal property tax provisions. While it also provides relief to homeowners, by giving local governments the ability to raise local income tax rates, individuals could see taxes shifted elsewhere to help offset the loss to local governments.
- What Comes Next: These changes will go into effect July 1, impacting 2026 tax bills.
A Big List
Education & Workforce
- Several bills made it across the finish line, impacting education and workforce this legislative session. Below are some of the key bills to review:
- Deregulation: HB 1002 (Various Education Matters) is a House Republican priority bill intended to “deregulate” education. The 139-page bill strikes several optional provisions and mandates from existing code.
- Child Care: There were multiple bills aimed at increasing childcare options in Indiana, including HB 1248 (Child Care and Development Fund), HB 1253 (Child Care), SB 463 (Child Care Matters).
- Partisan School Boards: SB 287 (School Board Matters) is the bill that adds partisanship to school board races by requiring a candidate to choose a political party affiliation, declare as an independent, or identify as non-partisan on the ballot. The concurrence just passed the Senate with a vote of 26-24.
- DEI: There were some tweaks made to SB 289 (Unlawful Discrimination) during conference committee, but ultimately the bill that passed centers around diversity, equity, and inclusion practices of state government and public education. It was heavily amended to shift the focus from whether DEI offices could exist to what practices entities could engage in.
- To view additional legislation impacting education and workforce, click here.
Healthcare
- Addressing the cost of healthcare remained a top priority for House and Senate leadership, but how to do that was hotly debated this legislative session. These are some of the bills that passed impacting the health care space:
- Both HB 1003 (Health Matters) and HB 1004 (Health Care Matters) were priority bills for the House Republican caucus. HB 1003 includes several provisions intended to improve transparency in pricing, including language impacting prior authorization, while HB 1004 threatens a hospital’s non-profit status if their costs are higher than a statewide average.
- Meanwhile SB 2 (Medicaid Matters) was a priority bill for the Senate Republican caucus and targets Medicaid fraud through a variety of measures.
- As introduced, SB 140 (Pharmacy Benefits) would have prevented vertical integration between PBMs and health insurers in Indiana. The bill was heavily amended in the House.
- SB 480 (Prior Authorization) mirrors the prior authorization language found in HB 1003 and prohibits private insurance companies from requiring prior authorization for the first 12 physical therapy or chiropractic visits for new injuries or “episodes of care.”
- To view additional legislation impacting healthcare, click here.
Local Government & Fiscal Policy
- How local governments are funded took center stage this session. While SB 1 has the biggest fiscal impact, there’s language in a variety of bills that could impact overall fiscal policy. Below are two key bills to review:
- HB 1427 (Department of Local Government Finance) starts as the Department of Local Government Finance agency bill every session but gets heavily amended throughout session. It now includes cleanup for SB 1, impacting Business Personal Property Tax, agricultural property taxes, and reduces franchise fees (a source of revenue for local units maintaining rights of way). It also includes language that allows hotels and motels in an economic enhancement district (EED) to collect a special benefits assessment of $1 per night from each person renting lodging to go toward the special benefits assessment.
- SB 5 (State Fiscal and Contracting Matters) creates a process for budget committee review when a state agency is awarded federal funds that may require a state match or additional staff. It’s also meant to increase transparency and accountability for state contracts.
- To view additional legislation impacting local government and fiscal policy, click here.
Transportation, Infrastructure, and Environment
- HB 1461 was the main transportation and infrastructure bill passed during the 2025 legislative session, but there were a number of bills impacting transportation and infrastructure this session.
- HB 1198 (Local Public Works Projects) allows a local unit to complete a public works project without awarding an outside contract if the cost of the project is less than $375,000 (increased from $250,000 in current law). Moving forward, this amount will be adjusted annually based on inflation.
- Increasing housing stock continues to be a goal for members of the General Assembly. HB 1005 (Housing and Building Matters) makes changes to the Residential Infrastructure Revolving Loan Fund.
- To view additional legislation impacting transportation, infrastructure, and environment policy, click here.