Andrew Downs & Brandon Smith

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Indiana legislators have returned to the state house following the General Assembly's mid session break late last week state lawmakers filed nearly 100 prospective bills this year and of these about three quarters of the House bills and two thirds of the Senate bills initially filed failed to move forward.

And among those that have died include measures regarding legal online gambling, limited vaccine requirements and Indiana's beloved breaded tenderloin as the official state sandwich.

>> The House passed budget now begins its journey through Senate appropriations as leadership from state agencies and higher education institutions gave their budget presentations to that committee this week.

>> The legislative pace is expected to pick up next week as committee hearings and floor calendars begin in earnest.

Thus it is a good time around this half time to spend time looking over the General Assembly session to date and will do that on this week's PrimeTime.

>> Good evening, I'm Bruce Haines.

With us today is Brandon Smith, statehouse bureau chief with Indiana Public Broadcasting and also with us is Andy Downes, director emeritus of the Mixdown Center for Indiana Politics at Purdue Fort Wayne and we invite you to join the conversation if you have any comments or questions as we go along.

>> Just call the number that you see on the screen as we widen out and welcome Andy.

>> Thank you very much.

Appreciate it.

Thank you, sir.

And we'll bring on Brandon Smith here in in moments and there he is calling in video in the video sense from outside Indianapolis.

>> Brandon, good evening to you.

Thank you so much for having me.

>> I'm really excited to talk about what's been going on down in my neck of the woods.

Well, it was so much for my first question that let me ask you this because as you cover all things in the statehouse and that this is not the first time you have done laps around that building, what is your sense of the general Assembly session so far?

>> Yeah, this is my 13th session covering the Indiana General Assembly and it's been a relatively calm one so far both from with the exception of a few bills right towards the end of that halfway point in the House and Senate attacking some of these more so-called social issues, particularly attacks on the LGBTQ community.

But other than that, it's been a very sort of calm, quiet session I'll even point to it's a little inside baseball but it speaks to sort of how the session is progressing, which is the speaker of the House and I Todd Houston and I we were talking right at the halfway point in our little gaggle that we did with the speaker and we commented that the House hasn't stayed past about eight o'clock the entire session so far.

That's extremely unusual.

They're not doing marathon four sessions and really either chamber and some of that's calendar management, some of its other things.

But some of it's that you know, to a certain extent most of these bills are passing without controversy.

They're passing it without a passing without significant pushback from the minority party.

>> So I think that kind of does speak a little bit to how the session is going and I'm going to ask Andy the same question.

>> Well, I think Brandon is making some really good points there for me for a long time I always wondered what was the blow up going to be in my experience a legislative session would move along something would happen and there'd be this big blow up.

There'd be like a reset and then they'd finish off the rest of the session.

That's pretty common but it hasn't always happened and it certainly hasn't happened this time around.

Brandon's right.

We're talking about some good calendar management here.

We're talking about some unanimity.

But we need to remember part of what we're looking at is a legislature that has a supermajority for one party and so theoretically if they do what you're supposed to do in a caucus room and come to some agreement beforehand, it's a little bit easier to move stuff through.

Obviously they want to be at least polite to the Democrats, to those who are in the super minority but a supermajority so they could choose to ram things through if they chose to do that.

>> But so far very calm, very polite session and it also seems that so far the main thing has remained almost everything.

There are some contenders for the biggest spotlight but that's of course the drafting of the next two year spending plan.

Republicans have passed now and over forty three billion dollar plan is gone to the Senate for its review.

>> Brandon, what's your review of their review so far?

>> Well, I mean, you know, Indiana writes its budgets every two years and so in a long budget session the budget is always the focal point in one way or another.

But this year it feels even more so I think than usual in part because a lot of the other big priority bills on both the House and the Senate side tie back into the budget whether it's on education, particularly K-12 education, whether it's on health care, both physical and mental health care in the state of Indiana and how the government helps deliver that all of these things housing a big priority for both Republican chambers, particularly the House Republican chamber as well as always Democrats again ties back to the budget.

So even more than usual, the budget is a focal point this year and you pointed out that it's a forty three a forty three billion dollar roughly state budget.

What's significant about that is that that represents a huge jump from the last state budget which was only about 30 seven billion dollars a six billion dollar increase in just one budget cycle is out of the ordinary.

That's a lot and there are a few reasons for that.

All of the federal stimulus money that came in the pandemic poured a lot of money into the state and then while inflation is bad for the average person's pocketbook, it's great for the government's pocketbook in terms of tax revenues because as the price of things goes up, sales taxes go up and people haven't stopped buying things certainly as the economy continues to move along relatively strongly.

So it represents this huge increase in just the overall budget number and what that's created is a lot more money for lawmakers to figure out how to move the jigsaw puzzle around and we joke sometimes but it's only about a half a joke that folks like Senate Appropriations Chair Ryan Mischler and New House Ways and Means chair Geoff Thompson in that job for the first time after Tim Brown, the former Ways and Means Chair retired after last year.

>> It's a lot easier to be to write a budget when there's less money because you just say no to everything, right?

So when there's a lot more money like we kind of have right now, then the decisions get a lot harder because everybody is coming to the government and saying we need money in part because of inflation a six percent increase in K-12 education spending sounds great, right?

But when inflation was about eight percent over the last budget cycle, well all of a sudden six percent actually put you behind where you need to be.

Now what House Republicans have delivered their budget is an increase over the biennium about 10 percent overall in K-12 spending.

We can talk more about exactly where they've decided to increase those dollars within the K-12 system.

But that's part of the puzzle here is that yes, there's a lot more money but there are a lot of people asking for a lot more money because they they're thinking well if not now, then when the and yeah, I think there are a couple of things that we should comment on here.

>> One of them is that for a lot of the legislators prior to the session they were talking about how good we were looking from a financial standpoint.

They were talking about the ability to go out and spend lots of money.

But there were also some legislators Liz Brown from this area being one of them who were saying hey, wait a minute, let's not get crazy.

We're not a bunch of drunken sailors here.

We've got to keep some eye on what we're doing.

So she was attempting to do some of that know that Brandon was referencing earlier and we need to keep in mind some of this money is one time money.

A lot of folks get excited and they say let's start a new program.

Let's add some new staff.

But hey, if it's one time money, it's one time money and that means you have it for two years.

But then after that you've got to figure out whether you want to keep it or not.

And if you're if your economy slows then you're not going to be in a good position to do anything with that.

The third thing that I want to mention here and we talked about a little bit before we came on air was the desire to take a look at maybe changing our tax structure here in the state of Indiana.

I'll use that language.

We'll see what happens there.

There's a task force that's going to look at that.

But when you start talking about changing your tax structure, you really have to kind of be thinking about how will we keep some reserve back just in case we do something that needs to be offset by a little infusion of cash.

>> Now the state's income tax this is a tossup for for both of you.

The state income tax rate is supposed to drop to about three percent.

I think the goal was supposed to be around two point nine and then it's projected to be at that marker several years prior to what it was first projected to be.

>> And that's again the House sharing this information on its way to the Senate in that chamber, senators are not so sure they want to play with the tax code quite this soon.

>> So I'm wondering whether this part is one of those tweak bills or something that we're going to see in the coming weeks and a.m. we start with you on that.

>> If you look at Indiana's history regarding taxes, you'll notice that a couple of things.

Number one, we've been more than happy to cut quite a few taxes over time.

Number two , some of them we have eliminated faster than we said we would eliminate them or cut them faster than we said we would cut them.

This is a pretty significant one when you start talking about eliminating the income tax, which is really what we're talking about here, then you've got to start to think well how do you replace that revenue?

Of course some people would say you don't replace it, you cut services and you have an environment that's very attractive from a tax standpoint.

Other people would say you can't cut that many services out of here.

You can't get rid of basically a third of the revenue or something like that and expect to be whole and replace it with something else.

So that conversation is going to be had.

There is a task force that is scheduled to be formed.

It's not actually passed into law yet but it's moving along pretty well.

So there will be a tax task force that will look at not only state but also local revenue and have a conversation about what to do including as it specifies in the bill the elimination of the individual income tax bracket.

>> Yeah, to to put some perspective to it, let's look at last year the last fiscal year which ended at the end of June of twenty twenty two Indiana that year in a strong strong fiscal year for some of the reasons we've already talked about Indiana finished that year with about ten billion dollars in sales taxes and in about eight billion dollars in individual income taxes.

>> The rest is corporate gambling revenue and some other things if you can tell me how to cut eight billion dollars from the state coffers and not have to slash government to the bone without, you know, dramatically increasing the sales tax or taxing a lot more things with the sales tax taxing services for the first time.

So every time you go to a lawyer or your plumber or the doctor taxing all of those things to I don't know how you do it, I guess I could earn a lot of money if I if I could figure that out.

But the funny part here for this session is that you just referenced that Bruce .

The House Republican budget looks at last year's tax cut package which as you said eventually will lower the individual income tax down to two point nine percent.

It's scheduled to do that by twenty twenty nine .

They want to accelerate accelerate that dramatically and finish that off in just three years time.

The Senate Republicans don't really want to do that at all but they also want to do a tax commission blue ribbon panel on taxes on taxation that Andy has talked about that looks at eliminating in the individual income tax entirely something that the House Republicans and House Speaker Todd Houston are at best a little dubious of .

So there's there's this really funny thing playing out between the two chambers about they don't quite know what they want to do when it comes to taxes and I'm not sure we're going to get a lot of answers in the in the in the short term.

I will say that the tax issue in the short term will be one of the things that I think divides House and Senate Republicans the most in the budget.

They will come to some conclusion on it probably somewhere in the middle but a lot will depend on what we hear in April which is we will get an updated revenue forecast in mid-April early to mid April and that every budget year is always the big it's a big day because we find out for sure how much money we are expected to have in the new state budget.

So everything that happens before that is just sort of drawing lines in the sand and sort of setting your feet for that final confrontation because really writing the state budget doesn't kick off until we get that final number.

>> Yeah, this was a point I was going to make and I'm happy that Brandon did.

There's a lot talking that goes on.

There's a lot of line drawing in the sand.

There's a lot of discussion about priorities.

But in the end until we get that revenue projection in April it's all kind of fiction but we are looking at better than expected revenue for for some number of months right now the projections seem like they might be positive yet again.

And so maybe what's going to end up happening is legislators are going to say we can afford to do a bunch of one time expenditures and we don't have to address the tax issue right now.

We'll address a tax issue later on.

That's what the task force will do for us so they'll have the fight.

Branden's they're going to it's going to divide probably the Republican caucus is plural but in the end they'll be able to say that's for later on.

>> We'll hand that off to the task force.

It's interesting too as you were saying and we're happy to go to any part of the budget you'd like to comment on but with some of this first time funding going through over to the Senate in the budget document, there's more money for my way pre-K.

There's more money for mental health facility grants for those who are incarcerated .

>> Five hundred million more for ready 2.0 and another let's see county health departments 225 million overall there are initiatives being taken seems out of this.

>> It's it's pretty widespread it seems.

Yeah, undoubtedly part of when I talked about this huge increase in the baseline budget and everybody asking for a lot money, a lot of things have come to a head here too.

Right.

So you just mentioned some of the biggest ones so ready that ready program that Governor Holcomb created two years ago, it was funded entirely by federal stimulus dollars that first round of funding from twenty twenty one.

>> The program has been an unqualified success.

Everybody seems to love it.

State lawmakers love it.

The governor loves it.

Local leaders love it because it is creating projects opportunities that otherwise simply are not possible and it's generated three fold private sector and local investment.

The vast majority of money that will be spent ready grant projects will not come from state or local government will come from the private sector but the government is able to use its dollars to leverage those private dollars.

It's a huge success and lawmakers are ready to jump headfirst into now using state dollars to pay for another round to the tune of five hundred million dollars which is what it was the first time but again in federal stimulus dollars.

So that's coming to a head after that success.

We also have the problems that the pandemic shown in even harsher spotlight on which is just dreadful public health delivery system in the state of Indiana.

We are at or near the bottom of the country for the amount that we spend on public health per capita.

>> There are some counties I heard this spread recently Marion County I think which is where Indianapolis is the highest in the state.

It spends about eighty eight dollars per person on public health and there are some counties that spend less than a dollar that is unsustainable.

Where you live dramatically determines the quality of health care you can get and that shouldn't that shouldn't be what it is.

And so lawmakers after a two year study commission after a two year commission looked at the public health delivery system, that commission delivered a recommendation to lawmakers looking OK, what do we need to do to actually fund public health ?

Same thing with mental health .

The Indiana Behavioral Health Commission took a couple of years to study what do we need to deliver better mental health care in the state of Indiana whether that's in community mental health centers, mental health crisis response in part through the nine eight eight crisis helpline which is important.

How do we do that?

Well, this commission did a two year study on that delivered its recommendation and has a big old number for lawmakers to consider.

So all of these things are sort of coming to a head at once and creating a lot of big price tags.

The kinds of which we see in a normal.

But was one of those maybe happens in a normal budget cycle this budget cycle we could see four or five of them have an opportunity to you.

I did a quick check and had fingers to make this work.

I found out that half of the top 10 bills in the House and the Senate are health related are medical related.

>> So to Brenton's yet part of what I found interesting about the governor's state of the state address was when he was talking about some of the spending programs.

He was talking about how it would be a shared expense that local governments would have to come up with some of the money the state would have to come up with some of the money, which is an interesting sort of nod to hey, let's let local control be local control.

Or remember during the pandemic there were an awful lot of places that said the governor is being too heavy handed.

The state government should not have this kind of control over us.

And so I thought part of what he was looking at here was saying OK, fine, we'll give you some of the control if you want to stay at that level that Brandon was mentioning less than a dollar less in a few dollars.

That's fine.

We'll do some cost sharing with you or some revenue sharing with you.

But if you're looking to spend more and you're willing to put money on the table than will do it.

The unfortunate thing here is what we could be looking at then is perhaps a growing disparity between public health from one county to another depending on who decides to take advantage of it.

>> And noticing to behavioral health is the lead bill in the Senate.

This is mental health centers.

The nine eight eight Suicide and Crisis Hotline 30 million not in the House, no.

>> The Senate apparently looking to add that to the budget before it works its way back across.

>> I think there is a genuine much better understanding of the importance of mental health as a health issue and some might want to say as a health crisis.

So I think Brendan may disagree that I think there will end up being some money in there specifically for mental health because of the growing awareness and I think that people are going to find that to be a pretty good expense.

We'll have to wait and see as we've pointed out several times, we really don't know until they get that revenue projection of what's going to show up in the budget year.

I noticed there was one where some notes before the session began and Brandon it seemed that there was a hope that the session would focus on health , education, the economy, workforce development and quote give the social issues a rest this session that hope it seems has not held to an extent.

>> Yes, it never does quite honestly.

People say that every year and other than Mitch Daniels able to manufacture that well in his time and Governor, the famous moratorium on social issues which he was somewhat successful at it generally doesn't actually follow through.

And what we're seeing happen and I referenced this right at the top of the show which is it all happened right before halftime.

So they plugged it all in to about one week of legislative action.

It's following what we are seeing across the country so the Florida don't say gay bill came to Indiana.

It doesn't go Indianness doesn't go quite as far as Florida's does but we see that rearing its ugly head here the the attack on transgender children in the form of denying them access to gender affirming care that we've seen in other states has started to pass I think Tennessee or Arkansas has recently passed one of those Alabama similarly I believe that has come to Indiana.

There was another bill that I would argue the most alarming of the group had to do with quite frankly the child abuse as relates to transgender children and basically legalizing that in many ways that bill may have been sidelined in the Senate but the other two probably won't be sidelined before the end of session.

But this is utterly predictable.

We saw a three fold increase in the number of bills filed this year attacking the LGBTQ community.

It's part of a national movement.

It's part of a national I hesitate to call it a debate but it's part of a national movement at the very least.

And we can't be surprised that a super majority Republican state like Indiana Republican lawmakers here are responding to I don't know if a large number of constituents but certainly very loud number of constituents and I think it's important for us to remember that Indiana in general has sort of trended conservative in recent years and so it's not surprising I would say I mean obviously Brendan Brandon knows this better than I do because he's down in Annapolis all the time.

But I think the change in leadership the two chambers has enabled or emboldened a few more legislators to introduce some of that more conservative or more social issue type stuff.

I could be wrong about that.

But let's also remember it's just a whole lot easier to get a hold of sample legislation used to be had to know somebody in another state who'd send something to but now go online.

You can get it in a couple of minutes organizations will send it to you.

They're happy to do it and the inconsistencies that can exist within these pieces of legislation become somewhat irrelevant.

So when you think about some of the legislation that Brandon was mentioning there, the idea that parental rights are supposed to be the highest rights that are available to anybody in the state cannot step in and then at the same time saying well, but in this one case we can.

>> So it'll be very interesting to see how that dissonance gets worked out if the two minutes that we have it's like a minute per person.

>> Brandon, let me ask you first what are you thinking of seeing or hoping to see hoping to follow in the coming weeks between now and the end of April?

>> Well, one thing we didn't talk about was education funding that will be another divider between the House and Senate Republican caucuses because while everybody wants to spend a lot of money on K-12 education, House Republicans are proposing a massive increase in the state school voucher program.

Families of four earning two hundred twenty thousand dollars a year could now get money from the government to send their kids to private school under the House Republican plan.

Senate Republicans notably Appropriations Committee Chair Ryan Mischler not quite so hot on expanding vouchers quite so much.

I think that'll be a major friction point between the two caucuses in the two chambers as we get towards the end of session.

>> And there's also a circuit breaker element in there that we could talk about when it comes to education Will.

I'll pass on that for right now.

Instead I'm going to bring a couple of things that are sort of oh, you're finally getting to them.

A lot of people up here might recall the attempts to eliminate township assessors.

There's a bill moving through will likely be seeing that happen again.

And back when Indiana's voter ID law got passed, there were a lot of people at that time who said the fraud that exists in the system is with absentee ballots, not Election Day voting.

If you want to address this, you need to be looking at mailed ballots well to go up now there's legislation about that.

So it's sort of like they're finally getting around to some things and that's important for people to remember legislate is a marathon.

>> It's not a sprint and yet in that marathon to let us also note the passing of Senate Bill 70 to it is Senator Jean Lightings annual effort to encourage cursive but it is apparently on its way to a possible study committee so tomorrow is another day I would like to point out some of my notes here are in cursive.

>> Some are printed, some are cursive.

I do I do know cursive well and I'm seeing that it is time to leave in bold black letters.

Brandon Smith is the statehouse bureau chief for Indiana Public Broadcasting and thank you so much for joining us, sir Andy Downs, director emeritus for the Mixdown Center for Indiana Politics at Purdue.

Fort Wayne , always a pleasure.

Thank you very much and thank you for allowing us to be a part of your Friday evening for all of us with prime time, I'm Bruce Haines.

>> Take care.

We'll see you again next week.

Goodnight