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Budget highlights
The Indiana Senate’s proposed two-year spending plan does the following:
•Increases K-12 tuition support by $331 million, about $20 million less than House version
•Increases funding for Department of Children’s Services by $30 million each year, $10 million less than House proposal
•Authorizes $338 million in capital projects at state universities
•Slows the phase-in of controversial performance-funding formula for state universities
•Reduces individual income tax rate from 3.4 percent to 3.3 percent
•Immediately eliminates inheritance tax, instead of the phase-out proposed in House budget
•Earmarks reserves for fiscal year 2013, estimated at $97 million, to be distributed in the pension stabilization fund

Budgeting for a better Indiana

“At a time when investment in our state’s educational system and infrastructure are key, what does a cut in individual income taxes and repeal of the inheritance tax say about Indiana’s priorities? It sends a message that we are not preparing for the future development of Indiana and the resources that are needed to ensure Hoosier children are ready for the workforce.”

David Sklar, president of the Indiana Coalition for Human Services

Budgets, the Indiana Coalition for Human Services reminds us, are moral as well as financial documents. The group, which advocates on behalf of social service agencies, delivers a harsh assessment of the Indiana Senate’s proposed budget, but it’s worth noting as legislative leaders prepare to hammer out the final two-year spending plan.

Fiscal policies that will give all Hoosiers the opportunity to succeed while ensuring adequate services for those who need assistance – in education, health care or simply to survive – are critical.

The budget proposal from the Senate majority places more emphasis on cutting spending than on serving those residents, but it’s not without some merit if you subscribe to the theory that money left in taxpayers’ hands will do more to help all Hoosiers’ economic well-being.

The proposed budget is particularly good for transportation, a jobs measure in its own right.

Fort Wayne Republican Tom Wyss, chairman of the Senate’s Homeland Security, Transportation and Veterans Affairs Committee, said the proposal seeks to address a looming shortfall in road and highway funding.

Like the House proposal, the Senate’s budget wisely moves funding for the Indiana State Police and Bureau of Motor Vehicles to the general fund budget and frees up excise tax dollars for transportation projects.

“That will release a ton more money – about $112 million for the state, $101 million for local governments,” Wyss said. “We do put some caveats in there. For the counties to be able to access this, they have to implement a wheel tax.”

Wyss, who was a county councilman when Allen County adopted a wheel tax, said the provision was a fair expectation for local government officials seeking more state support for infrastructure. More than half of Indiana’s 92 counties have yet to adopt a wheel tax.

The Senate version of the budget also creates the Major Moves Trust Fund, allocating $400 million over the next two years for major highway expansion projects.

Budget leader Luke Kenley, a Noblesville Republican, calls the spending plan “an opportunity budget” – a chance to address past problems and plan ahead. What sort of opportunity it offers to Hoosiers overall should be the focus as the session deadline nears.