Where the Indiana's next budget proposals diverge from Senate, House proposals

Here are five areas where the Senate and House budget proposals don’t line up.

Education

The Senate’s plan calls for more education money — and for that money to be spent differently.

If the Senate plan moves forward, the state would provide $358 million over the next two years for K-12 education, about $85 million more than the House budget proposal, and $76 million for higher education, compared to $23 million in the House.

The Senate’s K-12 school funding formula also dedicates more to highneed students,

boosting funds mainly for rural and urban schools. Democrats, such as Sen. Karen Tallian of Portage, praised the move, but said the budget could still use more money for the “complexity formula.”

The Senate also wants to bring back performance funding, something the House steered clear of in its budget, after a year when funding was altered by sometimes unreliable ISTEP scores. Its new plan allocates money to districts per student and lets schools divvy up the money between teachers based on performance.

“We had a bad experience with the performance funding model that we passed two years ago because the test blew up and misdirected the funds,” said Senate Appropriations Chairman

Sen. Luke Kenley, R-Noblesville. “So I think the House maybe was fearful of being involved in that situation. We think we’ve resolved that problem.”

The Senate version does leave out a one-time $500-per-pupil grant given to schools that choose to consolidate.

Pre-Kindergarten

The contrast between the House and Senate budgets is most stark in money they would set aside for expanding prekindergarten programs. The House proposed $10 million for On My Way pre-K. The Senate reduced that amount to $3 million, and added an additional $1 million towards a new online pre-K program.

The Senate’s plan also expands the pre-K pilot program to all 92 counties in Indiana. Kenley said the state already provides $437 million every year for services to children under age 5, so he doesn’t see the need for a major increase.

“I don’t see why we need to rush with the pilot program that just kind of incrementally pushes it up a little tiny bit at a time when in reality we’re already providing pre-K for a lot of people which gives us plenty of opportunity to decide which way we want to go,” Kenley said. “So I don’t see a pressing need to do this today.”

Kenley’s plan deviates from both House Speaker Brian Bosma, R-Indianapolis, and Gov. Eric Holcomb’s wish for $10 million.

Cigarette tax

Missing from the Senate proposal is a cigarette tax increase, pushed for by the House and health advocates. House Republican leaders proposed a $1 per pack increase to fill a hole that would be created in the state’s general fund if the House plan to divert all sales tax revenue to road funding becomes a reality in the road-funding plan.

Kenley has consistently spoke against both shifting the sales tax entirely to roads and the cigarette tax. He said a cigarette tax increase should be reserved to help fund healthcare if the federal government makes cuts to Medicaid.

“Indiana could have a big liability so I think at that time a cigarette tax would be a logical thing to look at,” Kenley said. “But today, my feeling is, if you don’t need a tax, don’t enact it.”

Indiana health groups have been advocating for the state to raise cigarette taxes in an attempt to make the state healthier. In 2016, Indiana was the 11th least healthy state in the country, according to America's Health Rankings’ annual report.

Bryan Mills, chairman for Alliance for a Healthier Indiana, said he was disappointed in the Senate’s version of the budget.

“It has been proven that raising the cigarette tax is the single most important step in preventing youth from ever starting to smoke and the greatest motivator to get adults to quit,” Mills said in a statement. “The Alliance will work hard the remaining

three weeks of the legislative session to pass a meaningful increase in the cigarette tax in the final state budget.”

Transportation

Although not a part of the budget, transportation spending will impact the final budget passed by the state.

While the Senate road funding plan mirrors most of the House’s plan, there are some differences.

The House plan raises about $180 million more money for roads than the Senate plan does, because the House plan calls for a shift of sales tax entirely to roads. However, that shift leaves about a $300 million hole in the general budget, which is where the cigarette tax comes in.

If the road-funding bill passes with the provision to move over the sales tax, leaders would have to find someone way to fill that gap — whether it’s with a cigarette tax or some other measure.

During testimony, several fiscally conservative groups called for the shift of sales tax entirely to roads, and were thankful when the House put that provision in their road-funding bill.

House minority leader Scott Pelath, D-Michigan City, was not impressed with the decision to keep part of the sales tax in the general budget.

“(Kenley) substantially worked with what the House republicans sent to him. And he found a way to make it worse,” Pelath said. “He removed the most popular provision of the roads plan which was to take the state sales tax on gasoline and allocate it where it belongs, which is to Indiana’s roads and bridges.”

The Senate’s plan also calls for a phasing in of the gas tax, and more fees, like a $5 new tire fee and $100 commercial vehicle plate fee.

Indiana State Police

Holcomb campaigned on the promise to give Indiana State Police raises, and mentioned it again in his State of the State address. Senate and House leaders too have mentioned the pay raises, but the Senate budget bill gives considerably more money to the police force than the House did.

Under the Senate’s plan, trooper salary funds will increase by 24 percent over two years, compared to 12 percent under the House plan.

An independent 2016 study by Mercer found that Indiana State Police make less than those in Hamilton County and Indianapolis both at the start of their career and throughout.

The starting salary for an Indiana State trooper is $40,902, compared to $64,502 for the Indianapolis Metropolitan Police Department, according to the study. The maximum pay for a state police officer is also about $9,000 less per year than that of an IMPD officer.

Bosma had previously said they’ll “do our best to keep it at the levels we talked about and also meet the needs of other budget numbers.”