South Shore bill headed for detour for 2008

BY PATRICK GUINANE, Times of Northwest Indiana 
pguinane@nwitimes.com

INDIANAPOLIS | Legislation to steer $350 million in state money toward South Shore expansion will take a major detour Tuesday.

Senate Tax Chairman Luke Kenley, R-Noblesville, said Monday he has decided to route the commuter rail funding bill to a summer study committee for further review. That means the effort to finance South Shore extensions to Lowell and Valparaiso is dead for the year -- unless region lawmakers can broker an unlikely backroom deal in the final weeks of the legislative session.

"I'm going to recommend that we put that bill back to the Tax (and Financing Policy) Commission for this summer, the reason being that I'm not comfortable with the funding mechanisms that they've put in there," Kenley said.

The legislation, House Bill 1220, would steer 12.5 percent of the state sales tax collected in Lake and Porter counties toward the proposed Lowell and Valparaiso lines, a move that would generate more than $30 million annually without raising local taxes.

The $350 million in state money would help leverage $500 million in federal dollars, with the Northwest Indiana Regional Development Authority expected to kick in another $150 million.

Kenley said the RDA money -- raised by Lake County casino taxes, a Porter County income tax and state money from the 2006 lease of the Indiana Toll Road -- doesn't represent enough of a commitment from region coffers.

Kenley said he also recognized concerns from Gary and East Chicago leaders, who argue that assigning $150 million in RDA money to the rail lines might sap funding from other RDA projects.

"It sounds like that RDA money has been spent about three different ways, and we need to pin it down so we don't have a misunderstanding there," he said.

Kenley plans to offer an amendment sending the rail bill to study committee when the Senate Tax and Fiscal Policy Committee meets Tuesday morning.

Some Northwest Indiana legislators remained hopeful they still could hammer out an agreement for South Shore funding during the final weeks of the legislative session, when high-level talks move behind closed doors. That House-Senate conference committee stage will occupy the last two weeks of the session, which is scheduled to end March 14.

State Rep. Chet Dobis, the Merrillville Democrat sponsoring the South Shore bill, said the odds are "slim and none" that such a deal could be reached. Others note that the South Shore expansion plan has won some favor from House Speaker Pat Bauer, D-South Bend, and Gov. Mitch Daniels, which they argue could help keep the concept alive.