INDIANAPOLIS | A House committee agreed Monday the South Shore Line expansion project should receive the $4 million a year expected to be saved by closing a Lake County tax loophole -- even as the underlying legislation veered dangerously off-track.
Following a recommendation by state Rep. Hal Slager, R-Schererville, the House Ways and Means Committee changed Senate Bill 367 to specifically direct the Northwest Indiana Regional Development Authority spend the money "only to establish or improve public mass transportation systems in Lake County."
The Senate-approved version of the legislation awarded the savings to the RDA but did not say how it must be spent.
RDA officials already had promised to use the funds to help expand the commuter rail line to Dyer.
The $4 million comes from adjusting the Lake County Residential Property Tax Credit to ensure only homeowners with less than $18,000 in total income claim the $300 credit intended to help low-income homeowners with their property taxes.
Last year some 13,400 homeowners whose incomes topped $18,000 received the credit because the current income definition does not include most investment or retirement income.
The tax credit is paid by the state, which deducts the cost of the credit from casino admission tax revenue that otherwise would go to Hammond, East Chicago, Gary and Lake County.
Hammond Mayor Thomas McDermott Jr. said last week he's "incensed" that money won't be returned to his city.
The South Shore Line money and Lake County tax credit adjustment are small parts of Senate Bill 367, which got turned into a "Christmas tree" on Monday, as committee members hung more and more unrelated proposals on a plan that started as a fix for various property tax issues.
One of those committee amendments nearly derailed the whole measure.
State Rep. Eric Turner, R-Cicero, persuaded the committee to add a provision allowing religious institutions that obtain state or local government contracts to discriminate based on religion in hiring, benefits or working conditions. The panel voted 9-8 for the addition.
State law currently requires all government contractors to sign a covenant promising not to discriminate based on race, religion, color, sex, national origin, disability or ancestry.
According to House Speaker Brian Bosma, R-Indianapolis, a religious university that works with the state wanted the ability to enforce its religion-based employment rules while still receiving state dollars.
House Democrats furiously protested the permission-to-discriminate provision, and Bosma agreed to send the entire measure back to Ways and Means Tuesday for that piece to be removed from the legislation.