HB 1001 / Chamber Supports
Add proposed income tax cuts and unfunded pension liabilities to the list of differences that will need to be negotiated by the House and Senate in the budget. In a town hall meeting hosted by the Kosciusko County Chamber of Commerce in early March, the Senate’s budget architect Sen. Ryan Mishler (R-Bremen) pointed out that the House-passed budget was missing a priority that was negotiated during the 2022 special legislative session. He’s referring to the $1B of excess reserves that was to be dedicated to the Pension Stabilization Fund in FY2023. This was an important agreement between the two chambers to allow legislation to move forward that would return more than $1B to taxpayers in the form of a refund.
Senator Mishler chalked it up to forgetfulness of House leaders that the provision was left out of their budget. Expect to see it returned in the Senate version of the budget. This means that a tranche of capital investments planned for FY23 may be pushed into the future. Specifically, a second round of Regional Economic Acceleration and Development Initiative grants, a deal closing fund for the Indiana Economic Development Corporation (IEDC) and a laundry list of public university building projects.
Another point of contention identified by Sen. Mishler is the House plan to accelerate individual income tax cuts that were enacted in 2022, but with guardrails that would protect the stability of state revenues. Mishler posits that a long-term plan to adjust the state tax structure is preferable to tweaking the tax code every other session.
One thing is certain, the proposed income tax cuts and the omission of the pension paydown can be added to a growing list of differences between the House, Senate and Governor. The list already included public health spending, vouchers and economic development incentives managed by the IEDC.
David Ober is the Indiana Chamber’s vice president of taxation and public finance. Ober, a native of Noble County, started with the Chamber in June 2022 and is a former state legislator and commissioner for the Indiana Utility Regulatory Commission.
