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State budget passes both Indiana chambers with overwhelming support on last day of legislative session

A view of Indiana government office buildings, including the Statehouse, from News 8's Avi8or drone. (WISH Photo)

INDIANAPOLIS (WISH) — Tens of millions of dollars in extra money is headed to Indiana’s schools.

It’s part of the new, two-year budget passed Thursday by state lawmakers in a surprisingly bipartisan vote.

So, who gets what in the spending plan?

Indiana’s massive multibillion-dollar state budget took center stage on the last day of the 2021 legislative session.

Rep. Tim Brown, a Republican from Crawfordsville, is the State Budget Committee chair and House Ways and Means Committee chair. He said Thursday, “We do a lot. We are balanced. We are strong. We are ready of the next budget. If there’s an economic bubble because of what the economy does nationwide, we are prepared, we are ready.”

The budget includes nearly $2 billion in new spending for K-12 education.

State Rep Ed DeLaney, a Democrat from Indianapolis, said “There’s real support for public education, and there’s two parts that I point to in particular: the substantial pressure to have a minimum pay of $40,000 for our teachers. That will increase recruitment, which is critical. We’ve got to get young people to want to be teachers and get them in there.”

In the budget, millions of dollars also will address racial disparities in the health care system and food banks; expand mental health resources; and increase post-partum Medicaid coverage from two months to a year, according to Rep. Robin Shackleford, a Democrat from Indianapolis.

Shackleford, who is chair of the Indiana Black Legislative Caucus, said, “The IBLC has advocated for this expansion for years as the state’s maternal and infant mortality rate was dismal in general, but even more so for Black mothers and babies.”

Every Democrat state representative who spoke Thursday about the new budget mostly favored the legislation.

Rep. Gregory W. Porter, a Democrat from Indianapolis, said “This is a favorable two-year budget. It’s one that even though I did not sign the conference committee report, I’m going to vote for this.”

Shackleford added, “This year, I am commending Indiana’s budget for making serious investments in our Hoosier communities. Including in the areas of healthcare, law enforcement and food insecurity.” “I’m happy to say this is my first time ever voting for a state budget since I’ve been elected. But I greatly appreciate everyone’s collaboration and work on this  budget and these bills this session.”

Rep. Carey Hamilton, a Democrat from Indianapolis, added, “I do have to mention my disappointment that we’re not expanding pre-K (prekindergarten). Instead, we have a pretty significant expansion of vouchers, and, that expansion, to the tune of $147 million over the biennium, is specifically designed to serve upper-middle class and wealthy families.”

In the end, both the House and Senate passed the budget bill with overwhelming support.

“We are setting the table to grow rapidly,” said Rep. Matt Lehman, a Republican from Berne. “Rapidly.”

“Now, we accelerate. Now, we grow. Now, we invest,” said House Speaker Todd Huston, a Republican from Fishers. “This is our time. This.Is.Our.Time.”

State lawmakers will have to come back to the Statehouse at some point later this year to work on redistricting. They are awaiting Census data from the federal government, which was delayed by the coronavirus pandemic, to get that process started.

Statements from officials

“This has been a historic legislative session and I’m grateful for all the support my Next Level Agenda achieved. Indiana will be in an even stronger position with this new budget which prioritizes investing in Hoosiers.

The Regional Economic Acceleration and Development Initiative will lead the nation in encouraging community collaboration to improve quality of place and advance industry sector development. The raises for educators, increased education funding, expanded broadband access and workforce development grants are all game changers.

Indiana will remain on a roll thanks to the teamwork of all those involved throughout this legislative session.”

Governor Eric J. Holcomb

“There’s no question that the hallmark of this legislative session is our unprecedented investment in K-12 education. Between the $1.9 billion in new money for K-12 in our budget and the $3 billion from the federal government, our schools are looking at $5 billion in new money.

Our budget also eliminates more than $1 billion in taxpayer-funded debt and invests in Hoosiers from all walks of life. The investments we are making in this budget will leave our state’s finances better than we found them. Rather than creating future obligations, we are creating flexibility for the state moving forward so that our state can continue to thrive and provide opportunities for all Hoosiers.

In addition to the tremendous strides we made with our budget, our caucus priorities will provide liability protection to businesses, schools, churches, not-for-profit organizations and individuals for damages if someone is exposed to COVID-19 on their property or during an activity they organized; support schools that had to dramatically change their operations this year by fully funding students who are learning virtually due to the pandemic; codify telehealth expansions implemented during the pandemic to ensure that all Hoosiers have access to the health care they need regardless of where they live; and improve local government accountability by allowing anyone who is subject to a public emergency-related enforcement action under a local health department order to appeal their case to the relevant local legislative body.

Senators from all over the state came to the Statehouse to do the work of the people, and we did so in a safe, civil and substantive way. I’m very proud of the work this body accomplished over the course of this legislative session, and I look forward to seeing the positive impacts of our work in the coming year and beyond.”-Senate President Pro Tem Rodric Bray (R-Martinsville)

Indiana’s next two-year state budget is truly historic, as it increases K-12 funding by $1.9 billion. The budget we passed today continues the General Assembly’s strong support of Hoosier students and schools with half of the General Fund appropriated for education. To further support our public schools and teachers, following recommendations from the Next Level Teacher Compensation Commission report, the budget includes the full $600 million down payment needed to improve teacher pay across the state. I am grateful for the continued collaboration between the Senate, the House of Representatives and the governor throughout this legislative session, and I believe this budget will ensure the future success of Indiana and greatly benefit students, teachers and families alike.

State Sen. Ryan Mishler (R-Bremen), chair of the Senate Committee on Appropriations

The Indiana Democratic Party, the organization that advocates for the future of Indiana and its families, today issued the following statement in response to the partisan budget deal that was announced this afternoon by Governor Eric Holcomb and the Republican supermajority in the Indiana General Assembly: 

“Because of President Joe Biden’s American Rescue Plan, Indiana has an opportunity to invest more dollars in the state, and it is encouraging to see the Indiana Republican Party heeding the advice from Hoosier Democrats to fund the state’s public schools at levels not seen since Democrats last controlled the Indiana House. That said, it should not be lost on anyone that instead of providing a full investment to public schools, Republicans are choosing to give more dollars to a partisan voucher system that Republican State Senator Vaneta Becker even described as being a ‘tool for the rich to educate their kids for free’.

Governor Holcomb and Statehouse Republicans are trying to have it both ways on education funding, but Hoosiers must remember that the Republicans have been consistently trying to tip the scales away from a strong public education for everyone to private schooling for some with taxpayer dollars.”

Lauren Ganapini, executive director for the Indiana Democratic Party

It’s been far too long since fiscal leaders have reached a budget agreement that joins together both sides of the aisle. Thanks to their efforts, the funds from the American Rescue Plan and the resilience of Hoosier families, we have crafted one of the biggest investments our state has ever seen. That’s why I joined my colleagues and voted for House Bill 1001, our state’s biennial budget that passed with a vote of 96-2.

I am relieved that help is on the way for the students and hardworking teachers of our community who innovated solutions to new and unprecedented challenges. I am grateful for the million dollar investment in our state’s food banks that met an overwhelming demand to assist individuals in need. I am excited to see an investment in our law enforcement officers and to help our communities provide body cameras, enhanced training, and more equipment that will assist them to meet the demands of our changing society.

However, there is still a lot of room for improvement. The workers in our restaurants and hospitality industries need more help. We need stronger assurances to our teachers that they will get the raises they deserve and we need to make sure unemployment benefits get to everyone who needs them. The truth is, a lot of Hoosiers are still waiting to get their unemployment benefits, on top of struggling to find employment.

This is a strong budget and it’s one that can stand as a foundation for a new, forward-thinking path for our state. I’m proud of the grant program we established to help small businesses, restaurants and the hospitality industry recover from the pandemic. I hope that those interested in participating in this program will reach out to my office so that we can connect them to these valuable resources. I’m also relieved that we finally made substantial investments in public health, especially due to our state’s abysmal rankings in that area.

Indiana Democratic Party

“This is how we make government work for all Hoosiers. We should remember that when we return to our next session and maintain this commitment to finding real solutions.”

State Representative Terri Austin (D-Anderson)

“Early Education Works – a coalition of advocates for Indiana’s early care and education sector – applauds the Indiana General Assembly for their continued investments in the state’s On My Way Pre-K program. We believe that high-quality pre-k is one of the soundest and strongest investments that Indiana can make in today’s and tomorrow’s workforce, and we are grateful that the state will sustain funding for On My Way Pre-K in the next biennium.

Our community of advocates looks forward to partnering with the Family and Social Services Administration on the ongoing implementation of the On My Way Pre-K program as well as efforts to maximize federal funding and strengthen the capacity and quality of Indiana’s early care and education sector.”

Anne Valentine, Vice President for Government Relations at United Way of Central Indiana

“This session, my caucus came to the Statehouse on a mission to stand up for each of our residents and provide a voice to the Hoosiers we represent back home. In line with that, we vowed to fight for a budget that was fair and that worked in the best interest of every person in our state.”

That’s why we fought so hard to get our amendments into HB 1001. Just a few weeks ago, my caucus stood on the Senate floor and offered around 40 amendments to the budget. Nearly all of them were voted down. Still, we kept on fighting, because we knew we had to do all we could for the Hoosiers who are struggling right now. And our persistence paid off.

Thanks to the federal funds from President Joe Biden’s American Rescue Plan, we were able to see many Indiana Senate Democratic Caucus priority items included in this budget. 

Our mission to increase funding for K-12 education and food banks, provide localities with support to give our teachers a salary increase, grant raises to direct support providers, restore funding for mental health and addiction—all of those goals are accomplished in this most recent budget.

Funding to assist with continued economic development projects along the Buffington Harbor area in my district was also included in HB 1001.

There were many, many victories in this year’s budget, and that is why I ultimately felt obligated to support HB 1001 on behalf of the residents in my district. 

However, I want to be very clear—I do not support the expansion to voucher programs that were made in the budget. My biggest point of consternation with HB 1001 was the continued siphoning of money away from traditional public schools to voucher schools.

I remain firm in my stance that our traditional public schools that educate 93 percent of our students deserve to receive 93 percent of educational funding. 

Still, I do want to applaud the passage of this budget and the wins that my caucus and community were able to secure. I commend and thank Sen. Mishler, our hard working fiscal staff and everyone else who spent countless hours putting this budget together. HB 1001 isn’t perfect, but I do believe it will go a long way to support Indiana residents and improve our state.”

Senate Assistant Democratic Leader Eddie Melton (D-Gary)

“It is encouraging to see the state truly invest in minority communities.

The Black community has been pushing for fundamental changes to institutions like law enforcement and health care, but the necessary funding wasn’t allocated. Now, thanks to the impressive funding in the next budget, I am confident that our minority communities will have the resources they need to make real change. We’ll start to rebuild community relations with law enforcement through enhanced training and body cameras, bring back trust between minority communities and their health care providers and make sure our Hoosier families have access to healthy, wholesome meals.

Each investment is another step in the right direction. I look forward to seeing where these investments lead our communities and will continue to make recommendations for future federal and state funding to ensure our communities are served.”

State Rep. Robin Shackleford (D-Indianapolis)

“When I ran to be your state senator in District 30, I made a commitment to voters that I would work to increase public school funding and finally give our hardworking educators the pay raise they deserve. Under the state’s new budget, these priorities were addressed, and I was proud to join colleagues on both sides of the aisle to vote for this legislation.

I also want to acknowledge the integral role that President Biden’s American Rescue Plan played in making this happen. Because of the federal funds allocated to our state, we have the ability to pay for projects like broadband expansion and new construction projects, which will help Indiana reach its next level.

This budget, while not perfect, addresses the top priorities of District 30 residents and is a victory for the state and our families. I hope this budget is just a first step in fully funding and supporting our public education system in Indiana.”

State Senator Fady Qaddoura

Broadband expansion to underserved areas/populations (various bills)
“What passed represents giant steps in the right direction to ensure access to and adoption of high-speed broadband, regardless of the city, town or community in which an individual or business resides. By allocating $250 million to these efforts, the state is continuing to show its commitment to modern connectivity and technology, which goes a long way in making areas attractive for businesses and individuals to remain in or locate.”

Increased business personal property tax exemption threshold (passed in SB 336)
“Too many small businesses were put in a situation where it cost them more to pay someone to calculate the personal property taxes on their machinery and equipment than the small amount they owed in taxes. The Indiana Chamber successfully advocated that the exemption threshold should be doubled to $80,000. That means approximately 35,000 additional small businesses across the state now will not have to pay a preparer to comply with the tax or the tax itself.”

Venture Capital Investment (VCI) tax credit improvements (passed in state budget HB 1001)
“The state’s VCI tax credit needed to be more on par with its neighbors and competitors in order for the state to attract more activity. That boost became a reality this year. The annual available credit amount increases from $12.5 million to $20 million. And the credit percentage itself goes from 20% to 25% overall and 30% for minority or women-owned businesses. Additionally, there is a new 20% credit for venture fund investors. Cities throughout Indiana are poised for growth, and these VCI improvements put Indiana in an even better position to establish needed venture momentum.”

First ever tax on vaping and e-liquid products (passed in state budget HB 1001)
“We applaud the General Assembly for recognizing the importance of implementing a meaningful tax on vaping and e-liquids – one that is on par with traditional tobacco products and high enough to hopefully discourage Hoosier youth from taking up vaping, which too frequently leads to cigarette smoking for this group.”

Free Application for Federal Student Aid (FAFSA) (SB 54, which failed to pass)
“Completing the FAFSA qualifies students for a variety of merit- and need-based financial aid. A measure to spur greater FAFSA completion fell apart in the final days, despite a version passing both the House and Senate in the same session for the first time. The Senate wanted the FAFSA completion to be a student expectation (with some opt-outs), while the House wanted to incentivize schools to urge completion – what the Senate and many others feel is the job of the schools anyway. Students often make their postsecondary education decisions based on finances, with some dismissing it altogether for that reason. Why legislators can’t see the importance of this and come to an agreement is frustrating, because their failure to act is hurting young Hoosiers and their families who do not know what financial aid opportunities are available to them and will miss out on those grants and scholarships that can further their education and training.”

Repeal of state wetlands law (passed in SB 359; Chamber seeking a veto)
“The reduction in wetland regulations will likely have negative impacts on water quality, flood control and quality of place factors that are connected to attracting the best and brightest workers and businesses to Indiana. Admittedly, the current system of regulation can lead to a lot of confusion – due to the number of local, state and federal government/agencies involved – and can be improved. But given the importance of wetlands, the ideal initial remedy should have been a thorough study with input by the regulated community – not the drastic changes proposed in this bill. We have asked Governor Holcomb to veto this potentially very detrimental legislation.”

Indiana Chamber of Commerce President and CEO Kevin Brinegar

“I commend the leaders on the Senate Appropriations Committee, House Ways and Means Committee and members in both chambers for their work on this budget.

I especially applaud my caucus for being persistent in putting people first as they fought to get important language into this budget. In committee and at the second reading deadline, we offered nearly 40 amendments to HB 1001. Nearly all were voted down.

Despite that, my caucus kept fighting. And thanks to this fight, and President Biden’s American Rescue Plan, we are able to invest in people with this budget.

We were able to invest more heavily in K-12 education, and give localities some of the dollars they need to give our educators raises.

We were able to restore funding for mental health and addiction, provide a raise to direct support professionals who take care of our family members with intellectual and developmental disabilities, increase funding for food banks and secure adoption subsidies for Hoosier adoptive parents.

We definitely saw some victories in this budget, and I celebrate how each member of the Senate Democratic Caucus fought for their constituents and ultimately made an impact on this proposal.

However, this budget contained one glaring issue that I couldn’t overlook. Despite the increased funding to K-12, the budget still disproportionately divides new dollars to favor vouchers at the expense of traditional public schools. 

Traditional public schools, which educate 93% of our students, should be receiving 93% of funding. Instead, voucher schools that educate only 4.5% of our students are receiving over 10% of funding, which siphons away dollars from our traditional public school system.

This expansion of voucher programs at the expense of traditional public education is an ongoing trend in the General Assembly, and I believe it communicates the value we place on the schools and teachers that teach the overwhelming majority of our students.

While I am proud of my caucus for their very meaningful victories with some of the items we were able to get included in this budget, I will not support the expansion of voucher schools at the expense of our traditional public schools. That is why I ultimately voted against the budget.”

Senate Democratic Leader Greg Taylor (D-Indianapolis)

“Thanks to the work of the Indiana General Assembly, a greater number of new physicians will undergo the rigorous education and training that is necessary to lead medical teams and meet the needs of Hoosier patients.”

Roberto Darroca, MD, president of the Indiana State Medical Association, one of 13 groups that are members of the coalition.

We will lose more than 11,000 Hoosier lives to tobacco use this year, so it is disappointing that lawmakers once again passed up the opportunity to tackle Indiana’s tobacco crisis,” “The smoking-related challenges we face in Indiana are simply too big to ignore, so we are committed to seeing this across the finish line in the years ahead.”

Bryan Hannon, government relations director for ACS CAN. 

“This legislative session won’t soon be forgotten and I applaud Governor Holcomb and legislative leaders for accomplishing a great deal during an uncertain time. This session certainly looked different than others, but the results were something Hoosiers have grown accustomed to under Republican leadership. Conservative fiscal management led to record new investments in education, communities, infrastructure, law enforcement and Hoosier communities. All done without raising taxes and without making the drastic cuts other states have had to make.”

Indiana Republican Party Chairman Kyle Hupfer

“The greatest asset Indiana has is our people,” Bauer said. “Any budget we pass needs to reflect that. In order to truly be a state that works, we have to invest taxpayer dollars back into programs that benefit the people who voted to entrust us with their money.”

After a better-than-expected fiscal forecast and an influx of funds from the American Rescue Plan Act, the initial budget proposal was revamped in conference committee, expanding funds for traditional public schools, mental healthcare, special education programming and the state’s food banks. It also includes a plan to raise teacher pay statewide, with a goal of setting a minimum $40,000 salary. These proposals had been called for by House Democrats during the first round of debate on the budget.

Over the past year, we watched Hoosiers in every walk of life join together to overcome the challenges of the pandemic,” Bauer said. “Too often we overlook the everyday workers and institutions that keep us functioning. But when we were faced with unprecedented disruption, they rose above and beyond our expectations to serve their communities in new ways. The least we can do to show our appreciation is to give them their proper priority in our budget.

This is not a one-time fight. This must be the beginning of a shift in our priorities as a General Assembly. Hoosiers deserve to know that their taxes are not being hidden away for the sake of vague platform promises, we owe them a clear plan for how we will make the budget work for them. That will continue to be my priority so long as I serve in the Statehouse.”

State Representative Maureen Bauer (D-South Bend)

“We are now acting responsibly by taking the new American Rescue Plan dollars and putting them where funding is needed the most. I can’t think of a better cause than food banks, which feed our families in need.

Food banks serve a significant role in our communities, and this past year has only emphasized their importance. Food banks stepped up in a moment of crisis, one that many Hoosiers are still living through, and fulfilled their ongoing mission to feed the hungry.”

State Representative Cherrish Pryor (D-Indianapolis)

“The new funds from the American Rescue Plan and our updated fiscal forecast changed the playing field,” DeLaney said. “For years, my colleagues and I have been calling for fair investments in traditional public schools and raising teacher pay. I stood on the House floor and proposed a minimum $40,000 salary for our teachers. Now that plan is in the budget. It seems the new funds have left the supermajority short on excuses to ignore the demands of the voters for action on these issues.

These are all things that we should have done years ago. We’re playing catch-up when we need to be looking forward.

Where is the vision? What is the future that the supermajority sees for Indiana? Nearly two billion dollars in this budget are tucked away for vague future uses. Our constituents deserve to know that we have a clear plan to overcome the challenges we’re facing. We have an opportunity and need the will to act.

The greatest failure of this budget is the decision to tax Hoosier’s unemployment benefits while using tax dollars to replace employer contributions to unemployment insurance. We could have boosted the finances of Hoosiers in this trying time. Instead, we’re clinging to the same old policies that hold them back. It’s time for new ideas.

We need to strengthen our public health systems. We need to tackle the threats to our environment. We need to invest in our colleges and universities and the infrastructure of the future. The world is changing at a rapid pace. The people of Indiana deserve a government that reflects that and can lead our state into a better tomorrow.”

State Representative Ed DeLaney (D-Indianapolis)