Indiana House panel amends, OKs unemployment tax delay

INDIANAPOLIS — An Indiana House panel on Wednesday voted to delay by a year new business tax rates intended to bolster the state's bankrupt unemployment insurance fund.

But first, the Democratic-led Labor and Employment Committee made some changes.

Among them were that eligibility for jobless benefits would be expanded; weekly unemployment payments would be higher; and Indiana would accept $148 million in federal stimulus dollars to help, even though strings are attached.

Still, the bill would achieve a key objective of Republicans such as Gov. Mitch Daniels. It would delay until 2011 the higher taxes on employers, which are intended to help the fund cope with its $1.5 billion shortfall.

Democrats said the bill would help employers and the jobless, but Republicans said the extended benefits would put more financial pressure on the bankrupt unemployment fund. The changes were approved on a 7-4 party line vote, and the overall bill passed 7-2 and was sent to the full House.

Republicans have sought the one-year delay in the tax increase, saying it could cost employers up to $360 million this year and cause layoffs in a tough economy.

Democrats have said the tax increase was meant to start shoring up the unemployment insurance fund, which already has borrowed $1.6 billion from the federal government to remain solvent. In order to go along with a delay in the tax increase, House Democrats insisted on the additional benefits for the jobless.

"It is prudent to try to help businesses the best we can, but we needed to try to do something for the workers also," said Democratic Rep. David Niezgodski of South Bend, chairman of the House Labor Committee.

"These dollars that you put into the unemployed's pockets, not one dime of it is going into the bank," he said. "They're going to be going for groceries, medicine, clothes."

Township reform

An Indiana Senate committee has revived a plan by Republicans to eliminate township boards and transfer their duties to the county level starting in 2013.

The Senate Local Government Committee voted along party lines Wednesday to amend the bill. It now goes to the full Senate.

Committee chairwoman Sen. Connie Lawson of Danville says the bill reflects the position of Senate Republicans. If the Senate passes the amended bill, it will go to a House-Senate conference committee to try to resolve differences between bills passed by the two bodies.

The House language stripped out of the bill Wednesday would allow voters in every township to vote in November on whether to get rid of their township trustees and township boards and transfer their duties to the county.

Education

The House Public Policy Committee on Wednesday amended and passed House Bill 1367, which allows schools more freedom in how they spend money.

The bill would allow school corporations to transfer funds between different funding areas — including general fund, the school transportation fund and capital projects fund — during 2010 and 2011. The bill would not include the ability for funds to be transferred to or from the debt service fund.

The bill passed the committee by a 6-5 vote, which followed party lines, with Democrats backing it.

Casinos

The House Public Policy Committee unanimously approved Senate Bill 405, this year's omnibus gambling bill, but did not amend the bill to add land-based casinos.

Committee Chairman Trent Van Haaften, D-Mount Vernon, said that issue would be held off until the entire House could discuss it.

Microbreweries

The House Public Policy Committee also passed a bill Wednesday that would allow microbreweries to sell alcohol on Sundays. The alcohol would be available for carryout at the location where the brewery makes the alcohol.

The Associated Press contributed to this report.