2013 Indiana General Assembly

Lawmakers set to approve state budget, adjourn for year

2013-04-26T23:00:00Z 2013-04-27T19:22:04Z Lawmakers set to approve state budget, adjourn for yearBy Dan Carden dan.carden@nwi.com, (317) 637-9078 nwitimes.com
April 26, 2013 11:00 pm  • 

INDIANAPOLIS | The Republican-controlled General Assembly early this morning was on the verge of approving a two-year state budget plan that reduces taxes on Hoosiers by $1.1 billion.

Following the vote, the 100-member House and 50-member Senate were expected to conclude their four-month legislative session and adjourn "sine die," or, for the year. State law permits the Legislature to meet through Monday.

The 2014-15 budget, contained in House Bill 1001, reduces the personal income tax rate to 3.3 percent from 3.4 percent, eliminates the inheritance tax, shaves 1 percent off the corporate income tax rate and cuts taxes on banks.

"We are in a positive fiscal environment to give Hoosiers the largest tax cut in the history of Indiana," said House Speaker Brian Bosma, R-Indianapolis. "This blend of tax relief will have a positive impact on Hoosiers across the state and will result in a tax cut for every Hoosier."

A Hoosier family earning $50,000 a year would pay $50 less in income taxes once the rate cut takes effect Jan. 1, 2015.

The budget plan calls for the income tax rate to drop to 3.23 percent in 2017, which would be a 5 percent reduction from the current rate; that's less than the 10 percent rate cut over two years promised by Republican Gov. Mike Pence on the campaign trail.

The spending plan boosts funding for elementary and high schools by 2 percent during the 2014 budget year, which starts July 1, 2013, and an additional 1 percent in 2015, with $34 million set aside for teacher performance pay and $20 million for school safety grants.

Transportation funding would grow by $210 million a year by dedicating 1 percent of state sales tax revenue and all gas tax proceeds to roads. An additional $200 million a year would be set aside in a Major Moves 2020 fund to spend on future large-scale road projects.

The budget also increases funding for the Department of Child Services by $35 million to pay for additional caseworkers and child abuse hotline improvements. It also includes $500,000 for a study of the need for a Gary trauma hospital.

House Democratic Leader Scott Pelath, D-Michigan City, said he believes the budget was "a missed opportunity" to provide middle-class Hoosiers the state services they need or to give them a meaningful tax cut.

"Maybe two years down the road an extra buck a week in their pockets? That's pathetic," Pelath said. "These tax cuts are a sham."

Democrats also questioned the distribution of funding for the state's private-school voucher program, which takes an indeterminable amount of money — based on the number of students that qualify for and accept a voucher — that otherwise would go to public schools.

"Because of the expansions that are going to be legislated this session, we've really created an entitlement program that leads into, basically, a fiscal cliff-type of situation because it's so open-ended" said Senate Democratic Leader Tim Lanane, D-Anderson.

The 118th General Assembly convened on Jan. 7 while Republican Mitch Daniels was still governor.

Upon adjournment, senators and representatives will have approved more than 200 legislative proposals that Pence is expected to sign into law over the next few weeks.

Lawmakers will return to the Statehouse during the summer and fall to serve on various study committees that look ahead to possible legislative topics set to be considered in 2014.

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