December 12, 2025

The unprecedented 2026 Legislative Session continued this week, running nearly a month ahead of schedule. Stay tuned each week as Aim focuses on proactive solutions and works to address the real-world impacts cities and towns are facing as a result of SEA 1-2025. Aim is seeking participation in the third survey in our Fiscal Impact Survey series, which focuses on gathering on-the-ground feedback from cities and towns. Your response is critical to helping lawmakers understand the cumulative impacts of SEA 1 and will directly inform Aim’s ongoing balanced solutions initiative.

REDISTRICTING

• This week, the Indiana Senate considered HB 1032, the proposed redistricting bill for Indiana’s nine congressional districts. It was heard in the Elections Committee on Monday, progressed to Second Reading on Wednesday and voted on Third Reading on Thursday.
• The final vote on HB 1032 had the proposed maps decisively defeated with a vote of 19-31.
• With a decisive defeat, the maps that were proposed cannot be voted on again during the 2026 regular session. The General Assembly could produce different maps for the legislators to consider, but that would require them to go back to the beginning of the process by filing a bill before the bill filing deadline on January 3, 2026, and moving the new bill through the committee and floor voting process. Given the lack of support for redrawing maps in the Senate, it is unlikely that a new bill will be filed.

PUBLIC SAFETY PENSIONS

• SB 69, 1977 pension and disability fund, would raise the salary basis for calculating pension benefits for the 1977 public safety pension plan by 1 point from 52% to 53% and increase the longevity bonus by a quarter of a point from 1% to 1.25%. It would also increase the death benefit from $12,000 to $15,000. This proposal would be paid for by an increase in the contribution rate for the employees of 2.65 points from 6% to 8.65% and an estimated increased contribution rate from employers of 1.43% (on top of the scheduled increases that resulted from increasing public safety salaries around the state).
• Aim opposes this bill because it increases mandatory spending by local governments at a time when they are experiencing property tax cuts from SEA 1 as well as looming uncertainty in local income tax revenue starting in 2028. As long as revenues remain unstable for long-term financial planning cities and towns members cannot afford mandatory cost increases.
• SB 69, authored by Sen. Linda Rogers (R-Granger), was heard in the Pensions and Labor committee on Wednesday but was held for further discussion at a future meeting.

What to Know for the 2026 Legislative Session

The Aim Legislative Dinner is on February 18. This is a no-cost event for Aim municipal members to foster engagement with lawmakers and create greater understanding of how state policy choices impact Indiana’s cities and towns.

To enter the legislative session prepared to make meaningful progress resolving some of the biggest challenges with implementing SEA 1, Aim created the Aim Balanced Solutions Initiative. The page contains Aim’s SEA 1 recommendations, as well as news clips and op eds covering a wide range of consequences and concerns about Indiana’s new local government funding system.

MARKET STREET TO MAIN STREET LEGISLATIVE PODCAST

Listen to more about this week on the second episode of the 2026 Market Street to Main Street Podcast Series, Aim’s legislative episodes of the Hometown Innovations Podcast and a supplement to this e-newsletter. In this episode, Jennifer sits down with Matt to discuss the this week at the General Assembly and what we expect in to see in this quick, short Session.

To listen to Market Street to Main Street, please visit The Terminal post and click the “play button” on the audio player. Or you can subscribe to Aim Hometown Innovations Podcast on Podbean, Apple Podcasts, and Spotify.

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