2017 Indiana General Assembly: Mid-Session Legislative Report

The 2017 Indiana General Assembly has reached the halfway point. The first half has been a successful one, as all of our legislative priorities are still alive and well as we move the bills across the hallway. We have actively engaged in the legislative process, testifying on behalf of the issues that fall into our 2017 legislative agenda priorities. We worked to draft legislative language to help fund land banks in the state and were successful in getting that language into a vehicle bill. While our successes are nice, we have a lot more work to do on road funding, pre-k, land banks, and getting the admittance tax for land based casinos across the finish line. Below is a breakdown of the specific legislation we’ve worked on specifically.

For further information or if I can answer questions, please do not hesitate to contact Justin Groenert, Director of Government Relations & Public Policy; 812-589-1650; jgroenert@swinchamber.com.

Road Funding Bill, the Chamber’s top priority, Passes the House

Bill # and Title:
HB 1002

Authors: Rep. Ed Soliday (R- Valparaiso), Rep. Holli Sullivan (R-Evansville)

Summary: increases annual road funding by around $1 billion. Includes a one-time 10-cent increase on gasoline, diesel, and special fuels. Creates a $15 registration fee to be used for the local funding grant program, adds a $150 fee for electric vehicles, and moves all of the sales tax on gasoline to roads and bridges. Also allows for a petition to federal highway for an exemption to toll and a study of tolling as a future revenue source.

Chamber Position: Support

Status: Bill passed the House by a vote of 61-36
Bacon – Yes
Hatfield – No
McNamara – Yes
Sullivan – Yes
Washburne – Yes

Update/Chamber Action: The Chamber has supported efforts to increase road funding for the past two sessions specifically and has a long track record of support for road projects. Prior to the legislative session, the Southwest Indiana Chamber took a lead in building a coalition of support among six of the seven largest metro chambers in Indiana. We have participated in the House roll out of the plan. We testified in support of the House plan and participated in the Build Indiana Council Road Funding Day.

The Metro Chamber Alliance sent letters of support, signed by the six CEO’s, to all 100 members of the House. We will send the same letter to the Senate as they take up HB 1002 and Governor Holcomb during the Chamber’s Day at the Statehouse on March 7. As we work the Senate, a more elaborate call to action will be needed.

The Senate Tax & Fiscal Policy Committee amended the bill to:
1. Raises excise tax (mirrors 10 cents) 2 year phase in of 5 cents
2. 6 cent raise on diesel 2 year phase in of 3 cents
3. surcharge diesel tax moved to pump
4. Index included capped at 1 cent annually. 7 year phase out
5. Eliminates sales tax on special fuels (administrative issues outweigh cost)
6. Keeps $15 fee on vehicles, commercial plate raise of $100, Increases IRP by 50%
7. Creates $5 fee on sale of new tire
8. Deletes FIRSST Task Force
9. Requires all funds go to transportation funding
10. Does increase aviation fuel tax by 10 cents
11. Keeps the tolling waiver provision as in the House bill. Allows but doesn’t require tolling
12. Does not discuss the sales tax on gasoline shift. Hershman feels it’s a better discussion as part of budget.
13. Provides a 10-cent aviation fuel tax increase that will go to municipal airports. This is a SWIN Chamber priority.

The Senate Tax and Fiscal Committee moved to pass the bill on to the Senate floor 11-2.

Senate Homeland Security and Transportation Committees will vote on the bill this week, but no further amendments are expected to the bill.

CALL TO ACTION: The changes to the bill are better than we feared but we prefer to keep the funding totals at closer to $1 billion annually. The Chamber has sent out an email request to email our Senators to support HB 1002 and the funding levels in it. Please take a moment to email Senators Becker and Tomes to ask for their support. We will remain engaged.

Resource: Justin Groenert | 812-589-1650, jgroenert@swinchamber.com

House Pre-K plan passes House

Bill # and Title:
HB 1004: Prekindergarten Education

Authors: Rep. Bob Behning, (R-Indianapolis); Rep. Holli Sullivan (R-Evansville)

Summary: The bill expands the current Pre-K pilot program from the current 5 counties to 10 eligible counties. Allows the division of family resources (division) to award an early education matching grant to an eligible potential eligible provider or existing eligible provider that: (1) submits an expansion plan to the division that details the potential eligible provider’s or existing eligible provider’s plan to: (A) increase the capacity of providers of eligible services to serve a greater number of eligible children; (B) increase the number of providers of eligible services; or (C) increase capacity of and increase the number of providers; and (2) meets certain other requirements. Allows for up to 20% of fund to be used for capacity building, growing more eligible programs within the 10 counties. Amends household income requirements for eligibility of a child for the: (1) early education matching grant program; and (2) early education pilot program (pilot program). Amends the amount of grant money an eligible child may receive under the pilot program based on annual household income. Provides that in kind funds, as determined by the office of the secretary of family and social services, meet the requirements regarding matching funds under the early education matching grant and the pilot program. Provides that: (1) an individual who: (A) receives an early education grant under the pilot program in the immediately preceding school year or received eligible services as an eligible child under the early education matching grant program in the immediately preceding school year from a provider that received an early education matching grant; and (B) is a member of a household with an annual income of not more than 200% of the amount required to qualify for the federal free or reduced price lunch program; is an eligible choice scholarship student; and (2) the individual is entitled to receive at least 50% of the state tuition support amount. Repeals a provision that provides that the receipt of a grant under the pilot program does not qualify, nor have an effect on the qualification or eligibility, of a child for a choice scholarship.

Chamber Position: Support

Status: Bill passed the House 61-34
Bacon – Yes
Hatfield – No
McNamara – Yes
Sullivan – Yes
Washburne – Yes
*Note- there is some concern amongst some in the delegation about the expansion of vouchers in the bill. This could cause some final votes to change from the list above.

Update/Chamber Action: The Southwest Indiana Chamber has joined the All in for Pre-K coalition with the United Way of Central Indiana and the Indiana Chamber among others. The United Way of Central Indiana is advocating for $50 million in state funding for the program. (Currently, there is $20 million in the House budget). The Chamber has hosted a local legislator round-table in November of 2016, been on weekly conference calls and lobbyist meetings to advocate for this pilot expansion.

The Senate heard HB 1004 in their Education Committee last week. They will amended the bill to strip the language out of HB 1004 and insert the language from SB 276 and voted the bill out of committee on 3/15. It has been recommitted to Senate Appropriations. The Pre-K bill is on third reading this week on the Senate floor.

Call to Action: We will work on an op-ed and will continue to monitor the need for further grassroots efforts.

Resource: Justin Groenert | 812-589-1650, jgroenert@swinchamber.com

Senate moves their Pre-K expansion bill

Bill # and Title:
SB 276: Pre-Kindergarten Education

Authors: Sen. Travis Holdman (R-Markle)

Summary: The Senate bill expands the pre-k pilot program to any eligible high quality pre-k provider in any county in the state. It continues to require longitudinal study on the effects of Pre-k on students in the program. Requires FSSA to: (1) monitor the educational outcomes resulting from the implementation of expansion plans; and (2) annually provide the governor and legislative council a report of the findings of the office concerning the educational outcomes. Establishes the prekindergarten pilot program fund for a technology based pre-k program. Makes an appropriation to the fund of $16,000,000 in both state fiscal years 2017 and 2018. Specifies that of the $16,000,000 appropriated in a state fiscal year, $1,000,000 of that amount must be used for reimbursement of in-home early education services. Repeals the provisions concerning the early education matching grant program.

Chamber Position: Support

Status: The challenge for Pre-K will come in the Senate, as the committee process has shown. The bill was passed out of the Senate Education and Appropriations committees and passed the floor vote
Becker – Yes
Tomes – No
Messmer – No

Update/Chamber Action: We testified in support of this bill in the Senate Education Committee and have actively met with members of the Senate to secure it’s passage. Since the bills have moved to the other chamber, SB 276 has yet to be scheduled for a hearing. We will continued to monitor it, but HB 1004 is moving through the Senate and will be the likely Pre-K vehicle.

Call to Action: For now, we’re taking a wait and see approach as to what may be most helpful. However, as seen above, we have some work to do with members of the Southwest Indiana delegation.

Resource: Justin Groenert | 812-589-1650, jgroenert@swinchamber.com

Chamber language amended into SB 310, passes Senate Unanimously

Bill # and Title:
SB 310: Land Banks

Authors: Sen. Brant Hershman (R- Buck Creek)

Summary: Allows a county fiscal body to adopt an ordinance authorizing a deduction for property transferred from a land bank. Allows a county fiscal body to adopt an ordinance authorizing the allocation of property tax revenue collected with respect to transferred properties to the transferring entities. Authorizes a third class city to which the unsafe building law applies to establish a land bank to manage and improve the marketability of distressed real property in the city. Establishes memberships on the land bank board of a third class city.

Chamber Position: Support

Status: The bill passed the Senate 49-0
Becker – Yes
Tomes – Yes
Messmer – Yes

Update/Chamber Action: The Southwest Indiana Chamber initiated with the City of Evansville, the Indy Chamber, and the City of Indianapolis, conversations on a local option to fund our land bank efforts. Rep. Holli Sullivan had legislation drafted that would allow our idea of a county option incentive to get the properties out of the land bank. Indy wanted an additional penalty on late property tax payments. Senator Hershman was willing to amend his bill that would expand the land bank language passed in the last session to third tier cities. Our language of a five-year county option abatement was amended into the senate bill and the bill passed unanimously. We are continuing to work with the City of Indianapolis and the Indy Chamber to get their amendment language added to the House bill.

Mark Fisher of the Indy Chamber and I met with Rep. Heath Van Natter, the House sponsor, on 3/13. We asked Rep. Wendy McNamara to amend the Indy language into the bill and discussed the possibility to ensuring a hearing with Rep. Kevin Mahan, chair of the Government Reform committee. The bill was heard in the Government Reform Committee. The bill was amended with the amendment language Indy has wanted, however there was a lot of concern in the discussion on the bill about the amendment. The bill passed out of committee by a vote of 7-3, however there were several caveats to those yes votes concerning the amendment. It was decided that the amendment language will be stripped out of the bill on second reading. It will keep the proposed funding option language we preferred and should get plenty of support on the floor. The bill was heard on second reading on Monday 3/27 and we expect a fairly easy passage on the House floor this week.

Call to Action: Not at this time.

Resource: Justin Groenert | 812-589-1650, jgroenert@swinchamber.com

Casino Entrance Taxes Reform passes House

Bill # and Title:
HB 1350: Casino Gaming Matters

Authors: Rep. Todd Huston (R- Fishers)

Summary: Provides that certain tax rates apply to a riverboat in a historic hotel district. Makes the supplemental wagering tax 3% of a riverboat’s adjusted gross receipts (AGR) for a riverboat that has relocated to an inland casino. Provides that the supplemental wagering tax shall be imposed starting the day operations begin at an inland casino. Provides that beginning July 1, 2018, the supplemental wagering tax is based on the riverboat’s adjusted gross receipts multiplied by: (1) the total riverboat admissions tax that the riverboat paid beginning July1, 2016, and ending June 30, 2017; divided by (2) the riverboat’s adjusted gross receipts beginning July 1, 2016 and ending June 30, 2017. Provides that for a one year period, the amount of wagering taxes that would be distributed to South Bend shall be deposited as being received from all riverboats whose supplemental wagering taxes is over 3.5% and distributed in the same manner as the supplemental wagering tax. Provides that after June 30, 2019, the amount of wagering taxes that would be distributed to South Bend shall be deposited in the state general fund. Provides that the Indiana income tax add back for: (1) 70% of deductions in state fiscal year 2019; and (2) 40% of deductions in state fiscal year 2020; is required for any deduction allowed on the taxpayer’s federal income tax return for wagering taxes. Provides that after state fiscal year 2020, the Indiana income tax add back for deductions allowed under the Internal Revenue Code for taxes based on or measured by income and levied at the state level does not apply to any deduction allowed on the taxpayer’s federal income tax return for wagering taxes. Removes references to “gambling excursions”. Repeals flexible scheduling for riverboats.

Chamber Position: Support

Status: The bill passed the House 74-22.
Bacon – Yes
Hatfield – Yes
McNamara – Yes
Sullivan – Yes
Washburne – Yes

Update/Chamber Action: We have worked with John Chaszar, Stacey McNeill, and Sally Rideout on this legislation. While the bill has more in it than just the admittance tax, we testified in support of the change. The Senate Appropriations committee supported the bill and has moved it to the floor for further consideration.

Call to Action: Not as this time

Resource: Justin Groenert | 812-589-1650, jgroenert@swinchamber.com

Terre Haute Casino Bill fails to get out of committee

Bill # and Title:
SB 354: Casino Operations in Terre Haute

Author: Sen. Jon Ford (R- Terre Haute)

Summary: Authorizes the licensed owner of a riverboat operating from Ohio County to establish a supplemental gaming facility in Terre Haute with the approval of the Indiana gaming commission (IGC). Provides that the IGC may not approve an application unless riverboat gaming has been approved by the fiscal body of the city. Provides that at least 50% of the qualified licensed owner’s proposed investment in a supplemental gaming facility must be for the development of the qualified licensed owner’s proposed nongaming amenities. Provides that the number of gambling games at a supplemental gaming facility may not exceed 50% of the gambling games permitted by statute. Provides for the imposition, determination, and distribution of the riverboat admission and wagering taxes with respect to wagering at a supplemental gaming facility. Provides that the supplemental gaming facility may not be transferred except as part of a transaction in which transfer of the owner’s license for a riverboat operating from Ohio County is approved by the IGC. Requires five annual payments of $3,000,000 from the qualified licensed owner operating a supplemental gaming facility to the department of natural resources for deposit in the West Baden Springs historic hotel preservation and maintenance fund. Makes a technical correction.

Chamber Position: Oppose

Status: Update/Chamber Action: The Chamber took an active role in opposing this legislation. We were the lone dissenter in public testimony. The other casinos in the state were opposed to this idea, but did not want to work against a fellow casino publicly. The bill was thought to not be getting a vote in the Senate Public Policy Committee. The bill ended up getting an up or down vote, which was tied at 5-5. Senator Becker voted with us against this bill in committee. With a lack of constitutional majority, but bill effectively died in committee.

Call to Action: None; however this is something we will need to continue to fight going forward.

Resource: Justin Groenert | 812-589-1650, jgroenert@swinchamber.com

Regional Infrastructure Idea moves to House

Bill # and Title:
SB 128: Regional Infrastructure Improvement Projects

Author: Sen. Mark Messmer (R- Jasper)

Summary: Provides that the Indiana finance authority (IFA), rather than the budget agency, administers the local infrastructure revolving loan funds (loan funds). Expands the types of entities that may participate in the loan funds. Authorizes the IFA to issue its bonds to carry out the loan funds. Expands the types of infrastructure that are eligible for the loan funds to include bridges or other public ways. Authorizes an eligible county that is a member of a commuter transportation district to use money in the eligible county’s major bridge fund to make grants for the commuter transportation system. Provides, that a regional development authority (RDA) may apply for a “FASTLANE” grant from the Federal Highway Administration (or a grant from any other federal program) for highway funding. Authorizes an RDA to enter into a supplemental funding agreement with the Indiana department of transportation (INDOT) or a political subdivision to contribute local matching funds to be used to pay a part or all of the nonfederal share of the costs necessary to carry out regional transportation infrastructure projects. Allows a county or municipality participating in an RDA to transfer money to a fund from its general fund or rainy day fund (or other available fund) to the RDA for purposes of providing funds for regional transportation infrastructure projects. Provides that a city, county, or political subdivision that fails to make a payment or transfer to a development authority as required is subject to a deduction by the state treasurer and a deduction of available funds from the development authority. Provides that the use of the major bridge fund for projects involving double tracking must be approved by the northwest Indiana regional development authority. Creates the regional development authority infrastructure fund (infrastructure fund). Provides that a regional development authority may expend money in the fund for certain infrastructure development projects. Provides that the Indiana finance authority will administer the infrastructure fund. Provides an adjusted gross income tax deduction to a taxpayer that makes a contribution or gift to the infrastructure fund. Allows a county, city, or town to provide local income tax revenue to the infrastructure fund. Upon recommendation by an RDA, authorizes a county or municipality to establish a cumulative fund for the purpose of funding regional transportation infrastructure projects.

Chamber Position: Support

Status: Update/Chamber Action: The Chamber Transportation Committee offered support for this legislation. T&I Chair John DiDomizio testified in support of the bill. Note that Rep. Mike Braun (R-Jasper) introduced the same piece of legislation in the House, but it failed to reach the floor due to deadlines.

The bill passed out of House Transportation 10-0 and has been recommitted to House Ways & Means.

Call to Action: We will support this legislation as it moves through the House Roads & Transportation and Ways & Means Committee in the House

Resource: Justin Groenert | 812-589-1650, jgroenert@swinchamber.com


April 3: Committee Report Deadline (House & Senate)
April 5: Second Reading Deadline (House & Senate)
April 6: Third Reading Deadline (House & Senate)
April 10-22: Conference Committees
April 21: Anticipated Sine Die