Budget will be main Republican focus Republicans in Indiana stand poised for the ultimate victory party when the polls close on Nov. 2. Their Man Mitch is running neck-in-neck with incumbent Joe Kernan for governor, they’re nearly guaranteed to continue their 25-plus year control of the Senate and they need to add only two seats for a majority take-over in the House of Representatives. So eager are they to begin, House and Senate Republicans have already announced their agenda for the 2005 General Assembly, including plans to revitalize the state’s economy and address the $800 million budget deficit, expand education options and amend the state Constitution to ban same-sex marriage.
The state’s budget crisis is the main focus of their agenda. Creative accounting has stalled the inevitable, but hard choices will have to be made in the next legislative session.
According to State Budget Director Marilyn Schultz, “Given the $800 million deficit and the depletion of savings, something has got to give. Revenue must increase or spending must decrease.”
With depleted savings, payments to schools, universities and local governments $750 million in arrears, nearly $1 billion drained from the Build Indiana Fund and millions more shifted out of pension and Medicare funds, the state has run out of stalling techniques.
In the words of Republican Sen. Robert Meeks, chairman of Senate Budget Sub-committee, “I don’t think we have any more rabbits to pull out of our hat.”
Admittedly unsure as to how they will solve the budget problems, Republicans are adamant that economic incentives for businesses are key to the state’s fiscal survival.
To that end, their agenda is crowded with tax credits and exemptions for corporations. There’s a 50 percent state tax credit to businesses relocating in Indiana, an increase in the cap on the venture capital tax credit to $20 million from $10 million and expanding existing sales tax exemptions for manufacturers.
Republicans have also outlined a tax amnesty initiative allowing delinquent individuals to pay past due taxes without a penalty during a designated eight-week amnesty period.
Assuming that those who owe the taxes are objecting to paying the money, rather than unable to pay it, Republicans predict this program could raise as much as $200 million — a sizeable portion of the deficit.
Additionally, the Republican-sponsored constitutional amendment that appears on the upcoming ballot would allow the General Assembly more latitude in charging and exempting property taxes.
Though some would affect individuals, the majority of changes sought are aimed at business tax decreases. Public question No. 1 would allow lawmakers to exempt business “personal property” from property taxes, reduce or eliminate inventory taxes and change other breaks such as the homestead credit.
Expanding educational choices is also a high priority. House Republicans recently released their “New Direction for Indiana” agenda in which they propose to improve the quality of teachers in Indiana public schools, expand access to charter schools and make college tuition more affordable.
Though details are sketchy, they propose a policy that will attract and retain high quality teachers by directing the “Education Roundtable” to study issues such as professional development, merit pay and teacher testing to ensure each classroom has a motivated and qualified teacher.
They also seek to increase the number and budgets of charter schools by removing statutory caps on the number that can be opened in a given year and abolishing funding caps. Under their plan, private universities would also be allowed to open charter schools.
In order to create more flexibility, they propose a public school choice for parents whose children’s schools are designated as failing under the No Child Left Behind Act, allowing students and the tax dollars that fund their education to leave failing schools and go to another school of the parents’ choice.
Republicans hope to make higher education more affordable for Hoosiers by requiring universities to limit annual tuition increases, and offering a pricing option that guarantees a fixed tuition rate for the first four years of college.
As part of their Protecting Hoosier Families plan, Republicans have also vowed to renew their efforts for a constitutional amendment banning same-sex marriage.
Although Indiana law already defines marriage as specifically between a man and a woman, Republican legislators believe that the state Constitution must be amended to reflect the definition and prohibit legal challenges.
Earlier this year, Indiana House Republicans boycotted General Assembly proceedings for over a week, protesting the Democrats’ refusal to allow debate on their proposed bill banning same-sex marriage. According to House Speaker B. Patrick Bauer, the Legislature needed to deal with more pressing priorities.
Candidates of both parties know they will face pressing economic, education and social issues in the upcoming legislative session. With a detailed agenda and the desire to control all three chambers of the Statehouse, Republicans are eager for the challenge.