Unemployment tax deal reached in General Assembly's end

INDIANAPOLIS | State lawmakers approved legislation late Friday night that would delay a scheduled increase in employer-paid unemployment insurance premiums for one year.

Senate Bill 23 also offers tax incentives for Indiana businesses to hire new workers, forgives taxes for out-of-state businesses that relocate to Indiana and funds training programs to assist some of the 330,000 unemployed Hoosiers find a job.

In addition, the measure directs the Indiana Department of Labor to write new rules regarding the classification of workers. State Sen. Karen Tallian, D-Ogden Dunes, insisted on the worker classification guidelines to stop employers from classifying regular workers as independent contractors to avoid paying certain taxes.

The Senate voted 50-0 to send the legislation to the governor. The House vote was 85-12.

The delay in the unemployment rate hike is expected to save Hoosier businesses about $400 million.

The unemployment legislation had been a sticking point for several days, with Senate Republicans insisting on a two-year delay in the rate hike, while House Democrats supported a total repeal, so long as Democratic job-creation proposals were included in the legislation.

A tentative compromise on the unemployment legislation was reached Friday evening, but for a while it was not certain the deal would be approved. Female Democratic representatives engaged in a self-described "girlcott" of the Democratic party meeting where details of the final proposal were revealed. Their angst stemmed from a decision by the all-male House Democratic leadership to take pending legislation sponsored by state Rep. Peggy Welch, D-Bloomington, strip out her proposal and use that bill for other legislation.

State Rep. Linda Lawson, D-Hammond, and several female legislators voted against the unemployment legislation to show they felt it was wrong for House leaders to steal Welch's legislation.

"It's time that they recognize there are 14 women who are smart, who are bright and should be brought to the table," Lawson said. "It was time to stand up for Peggy, and we did."

In other action, the House and Senate both approved House Bill 1367, legislation that would allow school corporations to transfer up to 5 percent of their money from one fund to another.

Lawmakers adjourned for the year just before midnight.