Today marks the start of the Indiana General Assembly’s biennial budget session, with its budget-writing task likely made more difficult by the fact that the state has money to spend.
In recent long sessions, declining tax revenue gave lawmakers good reason to reject spending proposals. But Gov. Mitch Daniels slashed spending approved by the legislature to build a $2 billion surplus. In addition, a December forecast estimated revenue increasing by about $1 billion.
But the legislature’s fiscal experts won’t really get to work on the fiscal 2014-15 budget until the April budget forecast is available. Larry DeBoer, professor of agricultural economics at Purdue University, cautions that the earlier revenue prediction showed inflation running at about 2 percent in each of the two fiscal years and the state’s population growing by about 0.6 percent.
This means that the added revenue will just about cover the cost of providing current state services at higher prices to a larger population, DeBoer writes. That probably means no added services from the current revenue stream. And it probably means no additional tax cuts without cutting the services that the state provides.
That fact sets up an immediate conflict between newly elected Gov. Mike Pence and the General Assembly. Republican candidate Pence proposed a 10 percent reduction in the individual income tax rate – a proposal that wasn’t received well by Republican fiscal leaders. Senate Appropriations Committee Chairman Luke Kenley continued to express reservations even after the December revenue forecast was issued.
Don’t expect the General Assembly to readily embrace the new governor’s proposal. Lawmakers have their own spending priorities, and there’s no great clamor for another tax cut. A November survey by Ball State University’s Bowen Center, in fact, found that two-thirds of Indiana voters would rather see the money spent on education and workforce training.
Some veteran lawmakers had suggested that the raft of education changes pushed by Daniels and outgoing state Superintendent Tony Bennett deserved some time for digestion, but efforts to amend some already are under way. Sen. Scott Schneider, R-Indianapolis, has filed a bill that would make Indiana the first state to opt out of the Common Core State Standards, a national initiative in which Bennett has been a key player. Many conservatives are opposed to the Common Core, and Sen. Dennis Kruse, R-Auburn, said the standards – approved by the appointed Indiana State Board of Education – would be examined by his Senate Education Committee this session.
The Common Core issue could be the first skirmish between moderate Republicans and the growing ranks of conservative Republicans. Unless GOP leaders can keep the new members in check, the advantage of their super-majority status in both chambers will be reduced.
Sen. Jim Banks, R-Columbia City, has filed a bill that could set up an interesting confrontation with the outgoing governor, who becomes president of Purdue University when he leaves the Statehouse this month. Banks’ bill would give regional campuses, including IPFW, more autonomy. As governor, Daniels frequently questioned the role of regional campuses and – as president of the Purdue system – he will now be in position to shape them as he wishes, unless the legislature intervenes in the meantime.
The General Assembly’s adjournment deadline is April 29, allowing plenty of time for heated policy discussions. To follow proposed legislation online, go to www.in.gov/legislative/ and click on Bills and Resolutions. You can track individual bills, look them up by subject or find out what each legislator is sponsoring.
On Tuesday, Fort Wayne City Council members will discuss the first formal proposal to spend money from the Legacy Fund that originated not from Mayor Tom Henry’s administration but from within the council.
Russ Jehl, John Crawford and Mitch Harper are seeking $2.1 million in Legacy money – financed by the lease and sale of the former City Light utility to I&M – for streets. The ordinance has no information about specific projects, simply requiring the money be used for needed neighborhood street repairs and replacements, helping build a stronger community, preserving the attractiveness of Fort Wayne as a wonderful place to live, and provide needed infrastructure.
Both Henry and six council members – two-thirds of the council – must approve any Legacy spending. The request comes a few weeks after the council approved spending about $20 million on nine projects initiated by the Henry administration and various Legacy committees.
The council will also hold its annual organizational meeting, electing a president and possibly changing some committee assignments.
Huntertown utility rates
A second public hearing on Huntertown’s utility rates is scheduled for today. A previous hearing in December was nullified because town officials failed to properly notify all their utility customers of the hearing.
Town leaders posted a notice of the meeting, but state law also requires that they notify in writing utilities customers who live outside town limits.
Huntertown officials want to switch from a flat rate to a metered rate, which would charge customers based on the amount of water they use.
The town council will also determine who will serve as council president.
East Allen board
Three new members will participate in their first East Allen County Schools board meeting Tuesday – look for more drama in a district that endures more than its fair share. Newly elected members Chris Baker and Bob Nelson both sought office seeking to make changes, and each is likely to attempt to do so quickly.
Arden Hoffman is the third new member. A long-time parent volunteer, he isn’t as likely to seek drastic changes, but he could bring an interesting new dynamic to the board in terms of governance and leadership. Incumbent Terry Lightfoot was re-elected, preventing what could have been a turnover in board control and efforts to stall the district’s redesign plan.
New officers will be elected at Tuesday’s reorganization meeting. The board sorely needs a leader intent on making decisions that benefit students and support teachers and staff.