INDIANAPOLIS (AP) -
Republicans who control Indiana’s Statehouse say fiscal restraint will be in
order when they write the state’s two-year budget in the coming months.
But as GOP leaders
preach frugality ahead of the annual legislative session which kicks off
Tuesday, they are also planning for a big increase in infrastructure
spending - and want to raise taxes to pay for it.
"We don’t have
enough revenue to even sustain our maintenance program,” said state Sen.
Luke Kenley, the Senate’s chief budget writer. Last year the Noblesville
Republican opposed a similar tax increase; now he says lawmakers need to
“face up to the fact” that more money is needed.
residents could find themselves paying more for cigarettes, gasoline or
vehicle registration in order to build out and repair the state’s roads,
highways and bridges. It also creates an awkward situation for roughly two
dozen Republicans who signed a pledge to conservative activist Grover
Norquist, promising never to raise taxes.
Indiana is sitting
on about $2 billion in reserves. Revenues are projected to grow 2 percent
over the next two years, which could bring in an estimated $1 billion in new
Still, GOP leaders
say they are cautious after the state collected about $300 million less than
expected during the current budget cycle. They don’t want to tap the
surplus, warning that a recession could be around the corner.
GOP leaders have
indicated so far that passing a budget and a road funding plan will be the
main priorities. A 2015 report found the state needs to at least double
infrastructure spending. Lawmakers directed some new money to projects last
year, but estimate they need at least $1 billion per year going forward.
What remains to be
seen is how much appetite there will be for other large-scale undertakings,
or what will be included in Governor-elect Eric Holcomb’s agenda. The
Republican has offered little beyond campaign slogans, but says he will
present his plan to take Indiana to “the next level” on Jan. 5.
“It’s going to be
lean times no matter what,” said Republican House Speaker Brian Bosma. He
added that popular ideas such as expanding a state run preschool pilot
program for poor kids are “not easy to achieve, given the tight
support for increased roads funding, but hasn’t said if he’ll back a tax
increase. He has also called for expanding the state’s pre-school program
beyond the five counties it currently serves, but says it should focus on
Democrats, who are
in the minority, have pushed for universal state preschool program, which
Republicans believe would be too costly. Democrats have played coy about
whether they will support a GOP roads plan.
They opposed a plan
passed by House Republicans last year because it would increase the state’s
18-cents a gallon gas tax by several pennies and increase by $1 the price of
a pack of cigarettes. They argued a tax hike was not justifiable when the
state had $2 billion in reserve, but the plan was doomed anyway because
Senate Republicans and Gov. Mike Pence, now the Republican vice
president-elect, didn’t want an election year tax hike.
Leader Scott Pelath, D-Michigan City, still questions if a tax hike is “the
best, or the only avenue, for raising revenues.”
Sen. Karen Tallian,
D-Portage, said the revenue pinch was a problem of Republicans’ own creation
after cutting or capping corporate and personal taxes in recent years.
that hangs over the session is what role conservative social issues may
play. Many social conservatives say they have been emboldened by the
election of President-elect Donald Trump and see now as the time to push for
Already state Rep.
Curt Nisly, R-Goshen, has said he will sponsor a bill that would ban
abortion in the state, despite a longstanding U.S. Supreme Court ruling
allowing it. Supporters are pushing the bill which they hope could lead to a
court case that could eventually overturn the Roe v. Wade Supreme Court
advocates say they are similarly optimistic about their chances following
Rep. Jim Lucas, of Seymour, plans to file the bill that would get rid of a
state law requiring a license to carry handguns.