INDIANAPOLIS — Senate Republicans are filling in their side of the state's budget picture, and the resulting image looks a lot like the spending plans previously adopted by the Republican-controlled House and recommended by Republican Gov. Eric Holcomb.
The revised version of House Bill 1001 approved Thursday by the Senate Appropriations Committee maintains the $34.6 billion, two-year spending total endorsed by the House, but changes to some appropriations to better reflect Senate GOP priorities.
For example, the Senate budget boosts tuition support for elementary and high school students by $535 million, to $14.9 billion for the 2019-20 and 2020-21 school years, an increase of $74 million compared to the House budget and $103 million more than Holcomb sought.
That new money is not specifically earmarked for teacher pay hikes, since Senate Republicans believe that would infringe on local control of education spending decisions and impede the collective bargaining process.
Instead, the Senate budget increases to $90 million the two-year allocation for Teacher Appreciation Grants, up from $60 million in the current budget, and requires all teachers rated "effective" or "highly effective" to receive a grant, with at least one-third of each district's total grant distribution reserved for teachers with less than five years experience.
"What I hear is that we have a hard time keeping new teachers, and so what I heard from members is that they wanted to do something for newer teachers," said state Sen. Ryan Mishler, R-Bremen, the Appropriations Committee chairman.
School districts statewide also collectively would have an additional $140 million to spend on any need, as the Senate budget, similar to the House and governor, proposes using state reserve funds to bring a teacher pension account to fully-funded status, and thereby reduce the contribution rate that school corporations annually pay on behalf of their employees.
Lawmakers in both chambers are urging school districts to use that extra money to increase teacher wages, and the Senate budget actually mandates that local school boards hold a public hearing for specifying how they plan to spend the funds.
Other Senate budget highlights include:
- $30.5 million over two years for school safety grants, an increase of $12.5 million from the current budget, but $7.5 million less than the House spending plan.
- A $104 million reduction in additional Department of Child Services funding compared to the House. But $105 million in reserved gas tax revenue would be available to DCS, if needed.
- Full funding for the state's Medicaid obligations ($5 billion), financial aid programs ($761.5 million), South Shore Line expansion contributions ($12 million) and the governor's new infant mortality prevention programs ($6.6 million).
- $11.6 million for deferred maintenance at Indiana University Northwest, Purdue University Northwest and other regional university campuses.
- $800,000 to fund the local share of a U.S. Army Corps of Engineers study of sand replenishment on eroded Lake Michigan beaches, particularly in Porter County.
The budget legislation, which is expected to pass the full Senate on Tuesday, almost certainly will be altered again in light of the revised state revenue forecast that's due to be released Wednesday.
Mishler said he anticipates the updated revenue data either will show similar or slightly less in projected tax receipts than the December forecast, so he budgeted for the state to end the two-year period with $2.2 billion in reserves, or 12.5 percent of annual spending — about $300 million more than the House proposed keeping in reserve.
"I believe the budget the Senate put forward today is a strong reflection of what is important to Hoosiers," Mishler said. "We have a balanced budget, we support our teachers and our students, and we maintain strong reserves and improve child protection."
State Sen. Karen Tallian, D-Ogden Dunes, the top Democrat on the committee, suggested that Mishler's plan stashes too much cash in the state's bank accounts at the expense of schools, teachers, retired teachers and other critical programs for Hoosiers.
"I think they've got too much money still in reserves. We're at 12.5% instead of 11. So we could still free up money," Tallian said.
The House budget had the state ending the two-year budget period on June 30, 2021, with 11.2% of annual spending held in reserve.
Ultimately, a House-Senate conference committee will hash out a compromise budget proposal over the next two weeks that must be re-approved by both chambers to advance to the governor to be signed into law.