Week of March 3, 2008

Taxation, Negotiation and Deliberation
Legislative session moves into final stretch

Tough negotiations and political maneuvering are the order of the day as the Indiana General Assembly moves into conference committee time, when the House and Senate come together to hash out differences on legislation that passed through both Chambers. Action was slow, but substantial, last week and is sure to be intense as the end of the 2008 legislative session draws near.

Property tax reform efforts continued to move through the legislative process. On Feb. 26, the Senate approved HB1001, 33-14, which moved quickly to a Friday conference committee meeting. Major differences between the House and Senate versions will cause friction in the next two weeks. There is sure to be much compromise related to the property tax caps placed on homeowners.

Also at issue is the elimination of the township assessors, led by State Sen. Teresa Lubbers (R- Indianapolis). Confusion over Senate procedural rules led to Lt. Gov. Becky Skillman missing a key opportunity to cast a tiebreaking vote on Feb. 25 that would have amended HB 1001 to consolidate all township assessors into a single, more accountable county assessor. It is likely this issue will reappear in the negotiations of HB1001 over the next two weeks. Expect the negotiations to also include a discussion of HB1105, which allows Marion County to consolidate fire departments into a single, more efficient fire/EMS service for the county and HB1196, which requires school board elections to be held during the fall general elections.

The House passed SJR1, which places property tax caps into the state’s constitution. This bill is expected to produce some heated debates in conference committee. In the House version of the bill, caps on homesteads would be based in part on household income and existing debt—currently about 30 percent of the property tax levy—and would not count against the caps. Gov. Daniels opposes these changes and may consider calling lawmakers back for a special session if this issue is not resolved in conference committee.

The House passed SB345 (the immigration bill). It now goes to conference committee sometime in the next two weeks. Differences between the House and Senate versions will attempt to be worked out. SB 345 requires Indiana businesses to utilize the controversial E-Verify system to screen new hires for citizenship. It also penalizes employers who employ illegal immigrants and funds the State Police to enforce federal immigration laws. The Indianapolis Chamber remains opposed to this bill and will work to ensure that businesses are not unfairly targeted for enforcement of federal laws.

Though the end of the legislative session is near, the tough negotiations are just now beginning. The Chamber will use this time to ensure pro-business, pro-government reform legislation continues through the process. And at the end of the day, Indiana will be in a strong position to remains competitive for business development and quality of life.