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Update, April 20, 2023: Senate Republicans released their proposed budget plan on April 13. Read about that proposal here.
Indiana House Republicans released their vision for the two-year, $43.3 billion state budget Friday, prioritizing plans to significantly expand the state’s school voucher program and speed up tax cuts for Hoosiers.
Notably, the plan significantly scaled back plans for public health funding, proposed in Gov. Eric Holcomb’s version of the budget. It does keep intact some of Holcomb’s other priorities, such as ensuring students don’t have to pay for textbooks.
House Republicans hold a supermajority in the chamber, which means they don’t need Democratic support to pass the budget. House Democrats declined to comment on the proposed budget Friday. (Update: Democrats later proposed two amendments that would have provided additional property tax relief, increased public health funding and expanded pre-K, among other measures. Neither of the amendments was successful.)
Here’s how the House budget plan differs from Holcomb’s proposal, and how it’ll impact you.
A massive expansion of school choice
House Republicans say they want to spend an additional $2 billion on K-12 education over the next two years. But, that won’t all go toward public education. The state would nearly double what it spends on school vouchers, expanding eligibility for the school choice program to 400% of the income required to qualify for free or reduced-price lunches.
Currently, families making up to 300% of the amount required to qualify for free or reduced-price lunches can obtain a school choice voucher. Under the House Republican budget plan, if your family of four makes about $220,000 per year or less, you would qualify for a voucher.
Per usual, a majority of the House budget would go toward K-12 and higher education.
The expansion could meet resistance in the Senate. Sen. Ryan Mishler, the Senate’s chief budget architect, shared an open letter on Facebook criticizing a lack of accountability for schools that participate in the state’s voucher program, after multiple incidents at one school.
Less money than expected for public health
The House Republican budget appropriates $225 million over the next two years to improve public health in Indiana, a significant decrease from the $347 million Holcomb asked for in his budget. That’s money that will largely go toward local health departments.
State Rep. Jeff Thompson, the House’s chief budget writer, was asked by journalists Friday why the chamber doesn’t want to match the governor’s request.
“It’s a huge increase on what we’ve done for public health,” said Thompson, R-Lizton.
Before the pandemic, Indiana spent only $55 per capita on public health funding, compared to the U.S. average of $91, according to a report from the Governor's Public Health Commission.
That leads to disparities in what some local health departments offer to their residents. For example, some counties don’t provide HIV testing or tobacco cessation programs.
Local health departments will have to opt in to receive the money, in an effort to ease concerns about giving up control to the Indiana Department of Health after some conservatives questioned the department's handling of COVID-19.
Still, a portion of county leaders remained opposed to the idea of increased funding altogether when the concept was discussed in committee earlier this legislative session, due to fears of strings being attached to the money.
Questions about mental health funding
House Republicans did not prioritize the Holcomb administration’s goal to expand a three-part system to respond to Hoosiers enduring a mental health crisis.
That system — designed as a 988 hotline to call, mobile crisis teams to respond and then stabilization centers as alternatives to emergency rooms or jails — has remained a priority of Holcomb and Senate Republicans. The costs to fully fund the system would amount to $130.6 million each year, according to state estimates.
Asked whether the budget contains funding for the system, Thompson did not provide a specific answer.
"I think those will definitely be a consideration as we move forward,” Thompson said.
Indiana for years has lagged behind much of the country in addressing suicide, and substance use disorder is driving an alarming number of drug overdose deaths. The state ranked 41st in treatment by the nonprofit Mental Health America, and researchers have said untreated mental health accounts for $4.2 billion in costs to the state — per year.
In the Senate, Republicans released their first bill — Senate Bill 1 — in part to symbolize their commitment to addressing many of those concerns. The bill, carried by Sen. Michael Crider, R-Greenfield, and endorsed by Lt. Gov. Suzanne Crouch, received unanimous approval in the chamber. Notably, many who testified in support cited the three-part system as the reason why they supported the bill.
Senators will be given an opportunity to shape the budget in the coming weeks.
Asked Thursday whether he hoped to see the full $130.6 million in the next budget, Senate President Pro Tempore Rodric Bray, R-Martinsville, said he anticipated a more incremental approach.
“It's a really big number,” Bray said. “We need to kind of step into this in a way that we can handle the responsibility that we're trying to take on and so I don't know if you'll see us get to that number or not. We'll just try and move that direction in a bold way.”
The House budget does, however, set aside $10 million in grants that can be awarded to counties that will provide mental health services for incarcerated Hoosiers.
That's been a priority of House Republicans. House Bill 1006 by Rep. Gregory Steuerwald, R-Avon, for example, seeks to alleviate Indiana's overcrowded jails by creating a formal process for judges to refer a defendant to a mental health provider as a condition of release prior to a trial or plea agreement.
The additional $10 million in the budget isn’t directly tied to HB 1006 but it could help counties provide the necessary treatment.
"There's some issues there with inmates and how we get them in the right spot to get the right treatment,” Thompson said. “And in some cases the local jail is not the best spot."
All Hoosiers could save money under the House’s budget plan.
Last legislative session, lawmakers enacted a series of tax cuts that would take effect every year through 2029. The House Republicans’ plan now, though, is to speed up that timeline and remove some guardrails that prevented the tax cuts from going into effect unless state revenue growth reached 2%.
Right now, the individual income tax rate is 3.15%, which represents $1,575 per year for someone with a salary of $50,000.
House Republicans propose cutting that rate to 3% in January 2024 and 2.9% in January 2026, rather than phasing in the cuts until 2029. If the House’s plan is implemented, someone making $50,000 per year would save an additional $325 over five years.
Altogether the cuts would generate $470 million in total savings to Hoosiers over the next two years and a cut of $1.6 billion through 2030.
Why get rid of the guardrails in the initial tax cut plan passed last year? Thompson said the state is in a “good spot” to go ahead and accelerate the cuts.
“We believe that Hoosier taxpayers would be in the best place to have those additional dollars,” Thompson said, “and they can spend those most wisely and improve their situation in their given lives.”
The Senate was largely opposed to tax cuts last year, agreeing to it in part because of the guardrails put in place. That means it may be a hard sell for House Republicans again this year.
What else is in the House’s plan
There is some property tax relief in the House budget plan, but it wouldn’t impact the bills Hoosiers receive this spring. Lawmakers have proposed temporarily lowering the property tax caps in future years, among other proposals to provide relief.
The House plan would also double the dependent child tax exemption for parents.
Like Holcomb, the House wants to appropriate $500 million to continue offering regional economic development grants under the Regional Economic Acceleration and Development Initiative (READI) program, increase Indiana Economic Development Corporation dollars and increase state police starting pay to $70,000 per year.
What’s next for the budget
The House Ways and Means Committee will amend its budget proposal into House Bill 1001 on Monday (House Republicans published a version online Friday). The committee will also consider amendments from Democrats before voting the bill to the floor.
Once it passes the full chamber, it’ll advance to the Senate where Republican leaders will propose their own spending plan. Once differences between the two versions are ironed out, it’ll go to Holcomb who is all but guaranteed to sign it.
"This is the first take at a budget and the Senate may have some different ideas and we'll see what they say," Thompson said. "It's a work in progress, no doubt, but we believe this is the right spot to be at today."
Header image: State Rep. Jeff Thompson, R-Lizton, speaks to journalists after unveiling the initial House Republican budget on Friday, Feb. 17, 2023, at the Indiana Statehouse. (Credit: Ryan Martin)
Indiana is probably the type of state that the Environmental Protection Agency had in mind when it proposed a new set of rules that target fossil fuel-fired power plants.
Not only is the state still reliant on fossil fuels for most electricity — more than two-thirds is generated by coal (47%) and gas (29%), data show — Indiana has some of the worst air quality and is one of the most polluted states in the country. The primary focus of the new EPA rules, though, is an attempt to significantly reduce the amount of carbon dioxide released by those plants. Fossil fuel-fired power plants are responsible for about a quarter of all greenhouse gas emissions, according to the EPA, and for about a third of the nation’s carbon dioxide emissions that are heating the planet.
Yet while Indiana has been slow to adopt renewable energy sources, the pace of the state’s transition away from fossil fuels has been picking up steam in recent years.
But not fast enough for the EPA.
President Joe Biden’s aggressive climate agenda would require states like Indiana to hasten their energy transitions considerably. The draft power plant rules, released in May, would broadly require utility companies to cut their dependence on coal and gas, and to adopt emerging technologies that would enable the use of carbon storage and hydrogen.
Now Indiana government leaders and electric utility companies are raising concerns. They say the plans would force Indiana power plants to retire early, which could substantially increase the cost of electricity for Hoosiers while risking the reliability of the electric grid. And they say the technology cited by the EPA is not ready for widespread adoption.
“For carbon capture, while this is a technology that the state is invested in, it is not yet at the scale needed to accommodate all the utilities in the state,” Brian C. Rockensuess, commissioner of the Indiana Department of Environmental Management, told lawmakers during a committee meeting this month.
Environmental advocates, however, are characterizing the concerns as overblown. They point to two federal bills — the Inflation Reduction Act and the Bipartisan Infrastructure Law — that contain grants and incentives for power plants to transition away from coal and gas. And they say the power industry always raises concerns about any new regulations but always finds a way to comply.
“They are like the boy who cried wolf,” said David Doniger, a former EPA official and current senior strategic director at the nonprofit Natural Resources Defense Council. “If you look at the track record, they say this every time and then, if the regulations are in fact adopted, the compliance goes smoothly.”
Indiana agency head raises concerns
Rockensuess voiced his concerns about the new EPA rules to Indiana lawmakers during an Interim Study Committee on Energy, Utilities, and Telecommunications meeting this month.
He didn’t dive into the pros and cons of the environmental impacts; rather, he focused on the difficulty for policymakers and regulators in Indiana who will be tasked with enforcing the final rules adopted by the federal government.
Among the difficulties, he said, are requirements for some power plants to use hydrogen to generate electricity or rely on carbon capture and storage to reduce emissions. Both technologies, he said, are not ready for wide use, yet the federal government would require Indiana to explain how the state would implement the new federal rules within 24 months.
“Bottom line is they are asking for a lot in too short of a time,” he said. “Indiana and other states are being set up to run afoul of that timeframe from the start.”
Those concerns were echoed in a joint letter sent to the EPA by his department, the Indiana Utility Regulatory Commission and the Indiana Office of Utility Consumer Counselor.
The study committee also featured an out-of-state speaker who shared fiery testimony in opposition to the EPA proposal. By the end of the presentation, Rep. Matt Pierce, D-Bloomington, questioned whether the Republican leaders considered inviting anyone with a different viewpoint.
“I was just kind of curious as to whether the chairman attempted to invite testimony from anyone in support of the rules, such as the Clean Air Task Force or the Natural Resources Defense Council, people along those lines?” Piece asked.
Committee chair Sen. Eric Koch, R-Bedford, said that such viewpoints were already well-known because of the EPA’s plans, but he would consider Pierce’s request if lawmakers take up legislation on the matter when the legislative session begins in January.
Koch, who also leads the Senate utilities committee, later confirmed to State Affairs that he was unsure what actions the Indiana General Assembly might take in response to the federal rule, but he does not plan to file legislation this year.
The chair for the House utilities committee — Rep. Ed Soliday, R-Valparaiso — told State Affairs he did not yet know if he would file anything.
Environmental advocates push back
While they were not invited to speak at the public meeting, many environmental advocates in Indiana are supportive of the president’s efforts to curb carbon emissions.
“Probably what you didn’t hear in the testimony at the Statehouse was the cost of mitigating and addressing issues related to climate change. And you probably didn’t hear the effects of air pollution and how that contributes to asthma and other diseases,” said Sam Carpenter, executive director of the nonprofit Hoosier Environmental Council. “In the big picture, all those things need to be considered.”
The Biden administration estimates up to $85 billion in environmental and public health benefits over the next 20 years.
Indiana once relied almost exclusively on coal for electricity. And while the state continues to be a top-five consumer of coal for electricity, the major utility companies have started shifting away from coal in recent years. They’ve largely replaced that fuel source, though, not with renewables but with natural gas. That’s because gas is relatively affordable, and it easily enables utility companies to both meet the daily electricity demands but also rapidly ramp up production during cold snaps and heat waves.
Some utilities are seeking state approval to build new gas plants even now. Indiana customers will be on the hook for whatever is constructed now — such as a gas plant — even if those plants are rarely used or even shut down because of federal regulations. And then Hoosiers will also have to pay for whatever the utility companies build next.
“This continued investment into fossil fuels is going to be a stranded investment,” Carpenter said. “Down the road that’s not going to be paying off. That’s just a bad path to take.”
If enacted, the new EPA rules are sure to draw litigation from Republican officials.
Attorney General Todd Rokita has already promised Indiana’s involvement: “Fortunately, the courts will almost certainly strike down these new EPA mandates — and on behalf of Hoosiers, I’ll do everything in my power to ensure that happens,” Rokita said in a statement about the proposed rules.
His comments align with those made by Indiana’s major utility companies. They accuse the EPA of overstepping — arguments that were at the center of a U.S. Supreme Court decision in 2021 that said the EPA lacked the authority under the Clean Air Act to regulate carbon emissions.
Others aren’t as confident as Rokita and utility companies.
Rockensuess, the state environmental management department commissioner, noted in his testimony that the EPA does have the authority because of new language contained in the Inflation Reduction Act, which Congress passed after the Supreme Court decision.
“It clarified and granted them the authority to regulate greenhouse gasses,” Rockensuess told lawmakers.
Rockensuess said he expected to see the final EPA rule by next May.
Header image: A row of solar panels sits outside AES Indiana’s Harding Street power plant. (Credit: Ryan Martin)
Republican gubernatorial candidate Eric Doden is calling on the Indiana Chamber of Commerce to end its support for school district consolidation in rural Indiana.
In a letter sent today, the Fort Wayne businessman labeled the business group’s position as “damaging.”
“While the stated aims of this position are laudable, the message sent to our small towns and rural communities is damaging,” Doden wrote. “Proposing to do away with small public school districts through consolidation will be seen as a death knell for the millions of Hoosiers who live in small towns and rural communities.”
For years, the Indiana Chamber has advocated for fewer school districts across Indiana. A 2017 study commissioned through Ball State University identified worse educational outcomes for students in smaller districts in several categories, including scores for state standardized testing and the SAT, as well as the pass rates for Advanced Placement classes.
The Indiana Chamber re-upped its position last month when it released its long term economic development plan. Among the listed policies was a goal to “reduce by half the number of very small school districts with enrollments below 2,000 students to provide much stronger educational opportunities for rural students and communities.”
More than half of Indiana’s school districts have fewer than 2,000 students.
In a statement to State Affairs, Indiana Chamber President and CEO Kevin Brinegar said the state is providing a “two-tiered educational system” depending on income and ZIP code.
“Hoosier students should not be limited academically solely due to where they live. And that’s the case now in some of the smaller school districts where students are not afforded the opportunity to take a full array of STEM, Advanced Placement or college preparation courses,” Brinegar said in the statement. “The Chamber’s stance on smaller school district consolidation is rooted in wanting to lift up young Hoosiers in these rural communities, so they have a better chance at prosperity by properly preparing them for the state’s current and future job opportunities.”
The statement also contained a specific response to Doden’s criticism.
“We would be happy to sit down with Mr. Doden and go through the research and show him why we have adopted this position for the betterment of the academic and economic opportunities for our young people,” Brinegar said in the statement. “The status quo that Mr. Doden is championing has and will continue to leave small communities, schools and students behind. That’s not acceptable.”
But whereas the business group sees consolidation as one way to improve life in rural Indiana, Doden sees the opposite.
“Across our state it’s easy to see the remnants of a school consolidation push that began in the 1950s,” Doden wrote in his letter. “Too many towns that lost their local school to consolidation dried up and were virtually swept from the maps while other towns kept their schools and their identities. These communities had a better opportunity to survive.”
Doden also cited one of his policy proposals, which would redirect $100 million in state money toward small towns — in an effort to address declines in populations and quality of life.
“With local leadership and local control, we can revitalize our small towns and hometowns with a fraction of the investment we give away in the form of incentives,” Doden wrote.
Doden addressed the letter to Vanessa Green Sinders, who will replace Brinegar as the Indiana Chamber’s leader. Her tenure will begin in January, so she was unavailable to provide comment to State Affairs. Either way, the Indiana Chamber’s members are the ones who suggest policy positions for the board of directors to approve before each legislative session.
In addition to Doden, the crowded Republican field for governor includes U.S. Sen. Mike Braun, former Commerce Secretary Brad Chambers, Lt. Gov. Suzanne Crouch and former Attorney General Curtis Hill.
Jennifer McCormick, the former state superintendent of public education, has emerged as the leading Democratic candidate. Instead of school district consolidation, the state should reevaluate its expansion of school choice vouchers, McCormick has previously said.
Header image: Eric Doden, 2024 Republican candidate for governor of Indiana (Credit: Eric Doden for Indiana Governor/Facebook)
The Indiana Supreme Court Disciplinary Commission today filed a formal complaint against state Attorney General Todd Rokita that alleges three violations of attorney professional conduct rules.
Rokita faces official allegations that he committed professional misconduct with his public comments about Dr. Caitlin Bernard after she provided an abortion to a 10-year-old Ohio rape victim last summer.
Rokita is defending his actions, saying that state confidentiality laws shouldn’t apply to him because Bernard was the first to talk in the news media about the girl’s treatment. It could take months before the state Supreme Court decides whether Rokita will face any punishment.
The commission didn’t ask for a specific punishment against Rokita, asking simply that he be “disciplined as warranted for professional misconduct” by the state Supreme Court.
Commission Executive Director Adrienne Meiring filed the complaint that focuses on actions by Rokita and his office between early July 2022 and Nov. 30, 2022, when the attorney general’s office filed a misconduct complaint against Bernard with the state Medical Licensing Board.
Bernard drew national attention in the days after a July 1, 2022, story by The Indianapolis Star quoting her about the young girl’s abortion just days after the U.S. Supreme Court’s overturning of Roe v. Wade.
The complaint against Rokita highlights his July 13 appearance on a Fox News program, during which he said he would investigate Bernard’s actions and called her an “abortion activist acting as a doctor — with a history of failing to report.”
It also points to his office’s unusual action of publicly releasing on July 13 a letter to Gov. Eric Holcomb that named Bernard in seeking records from two state agencies and a July 14 press release from his office about the investigation.
The complaint alleges Rokita’s actions violated confidentiality requirements of pending medical licensing investigations under state law and by doing so Rokita “caused irreparable harm to Dr. Bernard’s reputational and professional image.”
Rokita responded Monday with a legal filing saying that the confidentiality requirements shouldn’t apply to him because Bernard had already gone public about the girl’s medical treatment.
Rokita also argued that “The Attorney General, an elected official who answers to the public, has a duty to keep the public informed of the Office’s actions and decisions.”
The state Medical Licensing Board voted 5-1 in May to reprimand Bernard and fine her $3,000 for violating patient privacy laws. The board, however, voted unanimously to reject allegations from the attorney general’s office that Bernard violated state law by not reporting the child abuse that led to the girl’s pregnancy to Indiana authorities and did not issue any restrictions on Bernard’s medical license.
Why It Matters
The Disciplinary Commission’s complaint carries the potential of forcing the Republican attorney general from office.
State law requires that the attorney general be “duly licensed to practice law in Indiana.” The state Supreme Court, which has the final say over attorney disciplinary matters, has wide discretion, with options all the way up to permanently stripping an attorney of his law license.
Rokita won the Republican nomination for attorney general in 2020 over then-Attorney General Curtis Hill after Hill faced allegations that he drunkenly groped four women at a party celebrating the end of the 2018 legislative session.
The Supreme Court suspended Hill’s law license for 30 days, saying that “by clear and convincing evidence that [Hill] committed the criminal act of battery.” The court rejected the hearing officer’s recommendation of a longer suspension that could have forced him from office. Hill is now seeking the Republican 2024 nomination for governor.
Rokita has sought to burnish his anti-abortion and national profile with the Bernard case. Besides challenging Bernard’s medical license, his office last week filed a lawsuit against the doctor’s employer, Indiana University Health, alleging it violated federal law by allowing Bernard to disclose information about the Ohio girl’s treatment. The girl’s mother brought her to Indiana to receive abortion drugs because an Ohio ban on abortions after six weeks had taken effect after the U.S. Supreme Court’s ruling last summer.
Rokita is entitled to defend himself with a hearing before a judicial officer appointed by the Supreme Court, who would then submit a recommended punishment to the court.
In Hill’s case, it took about 14 months from the time that the disciplinary complaint was filed against him for the court’s five justices to receive the case and make their decision.
Rokita’s defense lawyers include two from the Washington, D.C., firm Schaerr-Jaffe. The firm also assisted the attorney general’s office with the case against Bernard under a contract allowing it to bill the state $550 an hour for work by the firm’s attorneys.
“This is a complaint against the official duties of the Attorney General and is an attack against his official capacity, so this is paid by the office,” Rokita’s office said.
Rokita isn’t backing down in the political battle, either, as he released a statement Monday calling himself “a passionate fighter” who “is beating back the culture of death, grievance and transanity being pushed by radicals in workplaces, schools, media and government.”
Democrats argue Rokita is using the Bernard case “to further his own personal political ambitions.”
“Todd Rokita’s actions toward Dr. Caitlin Bernard over the past year brought shame and ridicule upon our state,” Indiana Democratic Chairman Mike Schmuhl said in a statement. “Now, he is starting to see the consequences of making baseless claims regarding a medical professional on national television.”
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Header image: Indiana Attorney General Todd Rokita speaks during the America First Agenda Summit organized by America First Policy Institute. (Photo by Oliver Contreras/SIPA USA)(Sipa via AP Images)
Republican Sen. Jon Ford of Terre Haute confirmed Friday that he is resigning from the Legislature to become leader of an association that promotes the coal industry and other fossil fuel producers in Indiana.
Ford told State Affairs that he will join Reliable Energy this fall after his Senate resignation takes effect Oct. 16.
“I’ll be running the association, the business side of it,” said Ford, who faces a one-year prohibition on being a paid lobbyist after leaving the Legislature.
What is Reliable Energy?
Reliable Energy was incorporated as a nonprofit corporation by prominent lobbyist Matt Bell in 2020 with the same downtown Indianapolis address as his Catalyst Public Affairs Group.
In testimony to a legislative committee last year, Bell described the group’s members as “fossil fuel producers and the Hoosier businesses supporting the fossil fuel industry.”
“Reliable Energy advocates for policies that ensure an abundant supply of available, affordable and dependable energy in Indiana and across the country,” Bell’s testimony said.
The organization is an offshoot of the Indiana Coal Council.
“I think it really grew out of that group and is really a group made up of membership of people involved in energy in a lot of different ways,” Ford said. “Many of the members are vertically integrated power companies. Some produce coal, some produce energy. Most are involved in alternative energies, as well.”
Ford’s reasons for resignation?
Ford, who was first elected to the Senate in 2014, won reelection last November to a four-year term. His resignation will result in a new senator serving for three legislative sessions without appearing on a general election ballot.
Ford cited personal reasons for deciding to resign less than a year after winning his new Senate term.
“Some things in my life have changed that made me think, you know, the passing of friends and other life events made me rethink what I wanted to do in my life and what I had achieved in the district,” Ford said. “I just felt it was time to move on.”
Ford said the Reliable Energy position didn’t prompt his Senate resignation.
“The job really came after the decision that it was time to move on,” he said.
Ford hasn’t specialized in energy-related issues while in the Legislature and hasn’t been a member of the utilities or environmental committees that consider most such legislation.
Ford has been business development director for the economic and community development group Thrive West Central, based in Terre Haute.
Will Ford become a lobbyist?
State law prohibits members of the General Assembly from lobbying former colleagues for one year after leaving office.
Ford said that even after that time he was not sure he would become an advocate for Reliable Energy in the Statehouse hallways.
“This group has had a hired lobbyist for a while that’s worked with them, so I don’t know,” Ford said. “I would see it playing a similar role to many other associations that are out there, but, you know, main focus will be to grow it and to focus on where Indiana goes forward with energy.”
Involvement in selecting replacement?
Ford was noncommittal on whether he would endorse a candidate to replace him ahead of the caucus of Republican precinct committee leaders who will make that decision in the coming weeks.
“I don’t know at this time, it really depends, I guess, on who steps up,” Ford said. “I don’t foresee myself being at the vote, to be quite honest. I think it’s a decision of the precinct committeemen.”
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Header image: Republican Sen. Jon Ford speaks in the Indiana Senate chamber. (Credit: Indiana Senate Republicans)