With the road funding bill moving to the Senate last week, this week at the Statehouse was dominated by bills with lower profiles, but the potential for highly significant impacts on municipal governments. Read carefully this week’s Top 5. Several bills pre-empting local decision making are being considered and your outreach may be necessary in the days and weeks ahead.
Don’t forget the Aim Legislative Dinner! The event will be a can’t-miss for Aim members and legislators. We’ll gather at The Crane Bay in Indianapolis for an outstanding evening of celebrating everything our partnership with lawmakers has given the State of Indiana: quality places that attract top talent, vibrant arts and culture hubs, unique towns that epitomize what it means to be a Hoosier, and so much more. Book your hotel today – the room block deadline is Tuesday, March 7!
- The Senate will now craft HB 1002 into what they envision as the best approach for a sustainable long term funding plan. Senate leadership has provided little insight on the current plan, but most of the concern has centered on the gas sales tax conversion.
- There was little legislative movement on HB 1002 as we are wrapping up the end of the first half but there was one interesting development. HB 1002 was assigned to the Senate Tax and Fiscal Committee, which means the bill will bypass the Homeland Security and Transportation Committee
- Mayors from all across the state are showing support through Letters to the Editor and social media activities. This is something every community can do to help support a plan that will assist local governments in meeting their road infrastructure needs.
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Small Cell Tower Regulation
- Senator Hershman introduced a clarification amendment on 2nd reading this week and the bill was then ordered to engrossment. The bill will be called for a 3rd reading vote early next week where we anticipate a party line vote in the 41-9 Republican controlled Senate.
- SB 213 has a great deal of momentum as it moves toward the House of Representatives but we feel confident our best strategy is to work with the telecommunication providers to identify solutions which all parties can agree to.
- House Utilities Chairman Dave Ober is the anticipated House sponsor on the bill which will undoubtedly be sent to his committee for first review.
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Selection of Professional Services
- On Monday SB 126 was amended in the Senate Elections Committee to include language impacting the Public Works statute and placing new requirements on public works projects.
- Concerns have been mentioned about unintended consequences of this amendment and the impact of slowing down projects and hindering emergency projects that need to be completed in a timely manner.
- Aim is still gathering feedback from our membership and will continue to work with the Senator Liz Brown as the bill progresses.
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- Since reaching its “high water mark” in 2007, gross gambling revenue in Indiana has been consistently declining and is projected to continue its decline. Key legislators believe the industry’s tax structure needs adjusted to enable it to be competitive in a changing environment.
- HB 1350 is the vehicle for the changes. A reduction in the hold-harmless distribution to local governments was initially in the bill but has since been removed.
- The bill passed the House 74-22 and is now headed to the Senate. This bill will very likely end up in conference committee, where it will become a piece of budget negotiations on the whole.
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Posting of Roll Call Votes
- House Bill 1622 would require clerk-treasurers to post all council roll call votes to the city or town’s website within 24 hours after the vote is taken. The information must then be maintained on the website for four years.
- Although the bill’s author is aware of our concerns, he did not accept our suggestions at that time and the bill passed the House.
- As the bill continues to move through the process, we are still hopeful we can reach an agreement that will not impact municipalities who would be unduly burdened by this legislation.
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Road Funding Bypasses Straight to Tax and Fiscal
HB 1002 Transportation Infrastructure Funding (Soliday, R-Valparaiso; T. Brown, R-Crawfordsville; Steurewald, R-Avon; Sullivan, R-Evansville)
While it was a quiet week in regards to road funding there were a few developments that give some insight on what’s next. HB 1002 was referred to the Senate this week after passing out of the House of Representatives shifting the spotlight to Senator Kenley who has vocally supported a long term plan with increased funding for state and local roads. During Road Funding Day this week, Senator Kenley addressed the crowd and said “we have to get this done….it’s the first priority after the state budget.” One aspect of the current plan that Senate leadership has publicly voiced concern about is shifting the remaining 4.5% of the gas sales tax into the state highway fund. The concern is that this will create a large gap in the state budget, which House Republican leadership hopes will be filled by a $1.00 increase in the cigarette tax. Regardless, the concern is that any revenue removed from the current proposal will likely result in prospective local revenue being decreased.
HB 1002 had its first reading in the Senate on Thursday where the bill was assigned to the Tax and Fiscal Committee chaired by Senator Brandt Hershman (R-Buck Creek). The bill will bypass the Senate Homeland Security and Transportation Committee which indicates leadership is eager to get to work from a fiscal perspective.
Governor Holcomb also weighed in on the need for a long-term plan this week when he spoke to the crowd during Road Funding Day. The Governor told the crowd that “everything is on the table for funding a twenty year plan for roads and bridges.” There has been no lack of support for a long-term legislative approach from the Governor who continues to support a plan that maintains what we have, finishes what we started and satisfies our future needs.
The first half of session concludes next week which gives us time to prepare for when legislators hit the gas pedal again. We anticipate there will be several items impacting the road funding conversation, which include the budget bill, gaming revenue bill and the cigarette tax bill. The 2017 legislative session is shaping up for an exciting second half.
Aim Position: Support
Small Cell Towers Advancing in Senate
SB 213 Support Structures for Wireless Facilities (Hershman, R-Buck Creek)
SB 213 has been presented by telecommunication service providers as necessary legislation to effectively extend their services and ease their ability to position equipment where most needed. Our belief is that several aspects of the legislation are unnecessary and current processes do not hinder the telecommunication providers from meeting their needs. SB 213 is simply an overreach placing excessive restrictions on local government’s ability to determine best management practices in their community. As this bill continues to move through the legislative process we will continue to work with the communication stakeholders to identify areas for compromise that will allow local units to continue to protect the best interest of their community.
Our goal is to ensure that municipalities can protect our residents’ safety and property rights under a framework that gives communication providers sufficient rights to install structures and equipment that brings new and improved technologies into our communities.
SB 213 will be voted out of the Senate early next week and we believe the bill will be favored by Republicans in the House of Representatives as well. There is still plenty of time and opportunity available to improve the current language of the bill, though we must strategically focus on critical aspects of the language that are most concerning to local government and our constituents.
Aim Position: Oppose
Bill will Require Qualifications Based Selection for all Public Works Projects
SB 126 Government Ethics and Procurement of Certain Services (Brown, R-Fort Wayne; Bohacek, R-Michiana Shores; Randolph, D-East Chicago)
SB 126 was introduced as a bill prohibiting political contributions from contractors to locally elected officials during certain phases of a project.
On Monday, the bill was amended in committee to include language that requires qualifications based selections of contractors for all public works projects and also requires the local unit of government to publicly release the evaluation of all firms and individuals who provide a statement of qualifications.
Concerns have been raised that this requirement will cause unnecessary delays on projects and it may result in dangerous delays on emergency projects.
The amendment also reduced the time frame that contractors are prohibited from making a political contribution to the time an RFP is issued until a contract has been awarded.
The final part of the amended language urges the legislative council to assign an interim study committee to review contributions made to a state elected office holders in response to solicitations issued by the state.
SB 126 will be on 3rd reading in the Senate next Monday. The 3rd reading deadline in the Senate is Tuesday.
Gaming Tax Reform Bill Passes House
HB 1350 Gaming taxes (Huston, R-Fishers; Hershman, R-Buck Creek; Ford, R-Terre Haute; Kenley, R-Noblesville)
Rep. Todd Huston introduced HB 1350, which is an attempt to modernize Indiana’s gaming tax structure in light of consistently declining casino revenue and increased competition from surrounding states.
As originally introduced, HB 1350 would have reduced the cap on the supplemental tax payment (also known as the “hold-harmless” payment) that is distributed to gaming communities from $48M per year to $30M per year. This provision took on a couple different variations while moving through the House, but was completely removed on 2nd reading.
In its current form, HB 1350 replaces the $3 per patron admissions tax for riverboats with a supplemental wagering tax that is based primarily on the casino’s adjusted gross receipts up to 3.5% starting in FY 2019. It also phases out the “add back” wagering tax, which has been characterized as double taxation on a casino’s income.
It is generally accepted at this point in time that Indiana’s casino industry is threatened by a variety of factors, with increased competition from surrounding states a primary factor. In gaming communities, municipal budgets are greatly impacted by casino revenue, and declining industry has an impact on all communities as a general matter. As session progresses, this issue is likely to have an impact on budget negotiations, so Aim is watching the bill closely.
Bill Requires Posting of Roll Call Sheets on Municipalities’ Websites
HB 1622 Record of county and municipality votes (Speedy, R-Indianapolis; Freeman, R-Indianapolis)
Legislation to require the posting of all council roll call votes to municipalities’ websites has passed the House.
Under HB1622, clerk-treasurers would be required to post to their city or town’s websites all council roll call votes within 24 hours after the vote. Once posted, the information must be maintained on the website for four years. (Note: this only applies to municipalities with websites; there is not a mandate for municipalities to create websites if they do not already have one.)
Based on a great amount of feedback, we understand that 24 hours is an unworkable deadline. We also understand that in many cases, clerk-treasurers contract 100% of their website work out and therefore, would have to pay an outside company for this increased work. These concerns and others have been shared with the bill’s author, and we will work to narrow this legislation in a way that will not negatively impact municipalities who are not prepared to take on this requirement.
We are hopeful this legislation can be significantly reworked in the Senate, where it is now pending.