2006 REPORT CARD

Report Card on 2006 Legislative Priorities

Unexpectedly the General Assembly passed 193 bills in a short session that typically passes about 150 bills. The most explosive issue was not Major Moves but was legalization of the sale of fireworks in Indiana. Over 90% of the bills passed were negotiated and passed on a non-partisan basis with support from the industry affected by the legislation. Only about a dozen bills required major compromise. These bills reflected a conflict between political philosophies of private business vs. government solutions for delivery of services.

Outlined below are a few bills that will have an impact on our community. We followed these bills, making suggestions where appropriate, and having a significant impact on several. It is likely that the economic development legislation will provide significant improvements in our community over the next 10 years. We are not satisfied with the education, local government and taxation legislation. The bills as they came out of the Senate were better than the bills as they were reported out of the conference committees and passed. In these areas there will be major efforts in 2007 to remedy the deficiencies in the legislation.

Major Moves was also a better bill as it came out of the Senate. We had worked with area legislators and Senate leaders to incorporate the “Next Generation Trust Fund,” a 50% tax credit for tolls paid, and legislative appropriation of lease proceeds. These improvements were weakened in the final bill. However, the economic benefit to St. Joseph County over the next 10 years will be substantial and we look forward to major new construction projects on SR 23, Capital Avenue and U.S. 31.


ECONOMIC DEVELOPMENT

• Eminent Domain, HB 1010, requires property acquired by government to sell to another business to be purchased for 125%-150% of appraised value.

• Telecom Deregulation, HB 1279, allows local phone service to set rates without regulatory approval and expand video franchising statewide without local franchise agreements.

• Business Tax Abatement and Credits, SB 260-HB 1380, are expanded for used equipment purchased in the state, vacant property, headquarters relocation into Indiana and EDGE tax credits.

• Major Moves, HB 1008, provides $3.8 billion plus $1.5 billion of interest for new construction road projects. The net present value of the toll rate increase ($77 million per year) will be at least $1.9 billion over 75 years. The seven toll road counties are scheduled to receive $1.4 billion of projects while the rest of the state will receive $3.7 billion. The lease provides a tax shelter for investors based upon depreciation and interest.


EDUCATION

Statewide policy on attendance, HB 1347, requires school systems to hold a conference and document dropouts. It also encourages students to enroll in community colleges like Ivy Tech and to receive a high school diploma. ISTEP, HB 1240, is to be studied for potential changes in the testing program.


LOCAL GOVERNMENT

Evansville & Ft. Wayne Consolidation Plans, HB 1362, provides a process for consolidation of services in counties. Hometown Matters, which was the Cities and Towns initiative for local government funding, was killed.


TAXATION

$227 million of property tax relief, HB 1001, attempts to remedy last year’s freeze on property tax funds from the state. This will provide about 2% relief per year for homeowners, 2% of assessment cap on property taxes payable by homeowner in 2007 and business in 2010.