We Hoosiers like to think of ourselves as special, but when it comes to the current debate in the Indiana Statehouse over the budget, we're a lot like other states: Grappling with some post-recession questions about how to balance spending and taxes.
The struggle unfolding in the Statehouse has to do with the state's $2 billion surplus and two distinctly different views about what to do with it. The stash of cash follows lean years brought on by the 2008 recession, when Indiana - like many other states - saw deep drops in tax revenues and subsequent deep cuts in state spending on education and other public services.
Slowly but steadily, those tax collections have been rising as Indiana and other states gets back on their feet. It's good news, but here's the dilemma that it's led to: Should we restore those lost dollars to schools and other public services or use the surplus to lower taxes and lock in those cuts made under economic duress?
States across the nation, from Connecticut to California, have been wrestling with the same issue.
Republican Gov. Mike Pence is committed in large part to the latter. His number one campaign promise last year was to lower the personal income tax rate in Indiana from 3.4 percent to 3.06 percent.
The sound of a tax cut has Pavlovian appeal: It triggers a reflexive positive response. But the reality isn't that impressive. A typical middle-income Indiana resident would see their state tax obligation drop about $100; the poorest 20 percent of Hoosiers would see a tax cut of $18 or less. The richest 1 percent of Hoosiers might like it, since their taxes would be cut by about $2,200.
Yet a good chunk of those dollars would likely end up not in Hoosier pockets but in the federal treasury. Why? Because one of four Indiana taxpayers claims itemized deductions on their federal tax returns, and can write off the state and local income tax payments they make. By lowering their state tax bill, the Pence tax rate cut would raise their federal tax bill.
The Pence tax rate cut would take more that $770 million out of state revenues over the next two years. That's money that the fiscally conservative Republican leaders in the House want to spend making what they call "strategic investments" to bolster the Indiana economy.
The budget plan that GOP House leaders recently rolled out would direct most of those dollars back to local schools and state universities that took a hit in the budget-cutting years and back to local municipalities for repair of their crumbling roads and bridges.
The Republicans who control the Statehouse are having an interesting intra-party fight and so far, Pence seems to be on the losing side. The Republican budget-makers in the Senate seem as unconvinced of the merits of the Pence tax rate cut plan as their brethren in the House.
The Statehouse politics of it are intriguing, especially since Pence's possible presidential aspirations are thrown into the mix. But likely not so entertaining for many Hoosiers, living in a state with an unemployment rate higher than the national average, who are still hoping and praying for something good to jolt the economy.
- Maureen Hayden covers the Statehouse for the CNHI newspapers in Indiana. She may be reached at maureen.hayden@indianamediagroup.com.
I’ve not kept it a secret that I find people who dress their dogs in clothes to be, to put it nicely, somewhat more than just eccentric. And many friendly, helpful readers out there have not kept it a secret that they really wish I would not express my views about dogs dressed as humans.
Distrust of government secrecy has been elevated to an exceptional level with the disclosure the Justice Department covertly examined two months of Associated Press phone records to determine who leaked details to the AP about a foiled terrorist plot.
It sounds like the plot from a dystopian libertarian novel. The word “patriot” and the phrase “educating on the Constitution and Bill of Rights” triggered heightened scrutiny from the most intrusive agency in the federal government.
The action at the bird feeder has been spectacular lately: Cardinals, finches, songbirds in impressive variety crowding around all day long in search of sustenance. It is truly gratifying …
Everyone presumes that Sen. Chuck Schumer, the media-hungry Democrat from New York, wants to be the next Senate majority leader. His performance in the negotiations over the Gang of Eight immigration plan should bolster his case for an eventual promotion.
Someone had to take the fall for President Barack Obama thoughtlessly drawing a “red line” threatening serious consequences if Syria used chemical weapons. It turns out that it is the president himself.
There were other issues that had potentially greater financial impact or will leave a more resolute imprint on people’s lives, such as Medicaid expansion and Common Core.
It’s a bleak scenario. A massive earthquake along the New Madrid fault kills or injures 60,000 people in Tennessee. A quarter of a million people are homeless.
It’s a bleak scenario. A massive earthquake along the New Madrid fault kills or injures 60,000 people in Tennessee. A quarter of a million people are homeless.
Commentary
Discussion
Elected officials battle over budget
By Maureen Hayden CNHI
We Hoosiers like to think of ourselves as special, but when it comes to the current debate in the Indiana Statehouse over the budget, we're a lot like other states: Grappling with some post-recession questions about how to balance spending and taxes.
The struggle unfolding in the Statehouse has to do with the state's $2 billion surplus and two distinctly different views about what to do with it. The stash of cash follows lean years brought on by the 2008 recession, when Indiana - like many other states - saw deep drops in tax revenues and subsequent deep cuts in state spending on education and other public services.
Slowly but steadily, those tax collections have been rising as Indiana and other states gets back on their feet. It's good news, but here's the dilemma that it's led to: Should we restore those lost dollars to schools and other public services or use the surplus to lower taxes and lock in those cuts made under economic duress?
States across the nation, from Connecticut to California, have been wrestling with the same issue.
Republican Gov. Mike Pence is committed in large part to the latter. His number one campaign promise last year was to lower the personal income tax rate in Indiana from 3.4 percent to 3.06 percent.
The sound of a tax cut has Pavlovian appeal: It triggers a reflexive positive response. But the reality isn't that impressive. A typical middle-income Indiana resident would see their state tax obligation drop about $100; the poorest 20 percent of Hoosiers would see a tax cut of $18 or less. The richest 1 percent of Hoosiers might like it, since their taxes would be cut by about $2,200.
Yet a good chunk of those dollars would likely end up not in Hoosier pockets but in the federal treasury. Why? Because one of four Indiana taxpayers claims itemized deductions on their federal tax returns, and can write off the state and local income tax payments they make. By lowering their state tax bill, the Pence tax rate cut would raise their federal tax bill.
The Pence tax rate cut would take more that $770 million out of state revenues over the next two years. That's money that the fiscally conservative Republican leaders in the House want to spend making what they call "strategic investments" to bolster the Indiana economy.
The budget plan that GOP House leaders recently rolled out would direct most of those dollars back to local schools and state universities that took a hit in the budget-cutting years and back to local municipalities for repair of their crumbling roads and bridges.
The Republicans who control the Statehouse are having an interesting intra-party fight and so far, Pence seems to be on the losing side. The Republican budget-makers in the Senate seem as unconvinced of the merits of the Pence tax rate cut plan as their brethren in the House.
The Statehouse politics of it are intriguing, especially since Pence's possible presidential aspirations are thrown into the mix. But likely not so entertaining for many Hoosiers, living in a state with an unemployment rate higher than the national average, who are still hoping and praying for something good to jolt the economy.
- Maureen Hayden covers the Statehouse for the CNHI newspapers in Indiana. She may be reached at maureen.hayden@indianamediagroup.com.
I’ve not kept it a secret that I find people who dress their dogs in clothes to be, to put it nicely, somewhat more than just eccentric. And many friendly, helpful readers out there have not kept it a secret that they really wish I would not express my views about dogs dressed as humans.
May 17, 2013
Distrust of government secrecy has been elevated to an exceptional level with the disclosure the Justice Department covertly examined two months of Associated Press phone records to determine who leaked details to the AP about a foiled terrorist plot.
May 17, 2013
The federal government recently announced new regulations for buying fast food.
May 17, 2013
It sounds like the plot from a dystopian libertarian novel. The word “patriot” and the phrase “educating on the Constitution and Bill of Rights” triggered heightened scrutiny from the most intrusive agency in the federal government.
May 17, 2013
The action at the bird feeder has been spectacular lately: Cardinals, finches, songbirds in impressive variety crowding around all day long in search of sustenance. It is truly gratifying …
For my neighbor.
That’s what it’s like at his feeder.
May 14, 2013
On April 27, Dr. Jeff Butts demonstrated a rare form of servant leadership as he participated in the Go Love Indy westside service project.
May 13, 2013
Everyone presumes that Sen. Chuck Schumer, the media-hungry Democrat from New York, wants to be the next Senate majority leader. His performance in the negotiations over the Gang of Eight immigration plan should bolster his case for an eventual promotion.
May 13, 2013
Someone had to take the fall for President Barack Obama thoughtlessly drawing a “red line” threatening serious consequences if Syria used chemical weapons. It turns out that it is the president himself.
May 13, 2013
There were other issues that had potentially greater financial impact or will leave a more resolute imprint on people’s lives, such as Medicaid expansion and Common Core.
May 13, 2013
It happens every year at this time; I make a little dandelion whine. So here goes.
May 10, 2013
Follow me on Twitter
Will you be attending this year's Indy 500?
Tires
Telecommunications
Beauty Salons
Government
It’s a bleak scenario. A massive earthquake along the New Madrid fault kills or injures 60,000 people in Tennessee. A quarter of a million people are homeless.
May 19, 2013 3 Photos 3 Stories
Complete Report:
Part I: Are We Prepared? | Part II: Disaster Dollars
Part III: Lessons Learned | Part IV: Warning Signs
Part V: The Big One
When it comes to midsized family sedans, the Kia Optima ranks high on my list for its good looks, economy and value.
May 17, 2013 1 Photo
It’s a bleak scenario. A massive earthquake along the New Madrid fault kills or injures 60,000 people in Tennessee. A quarter of a million people are homeless.
May 19, 2013 3 Photos 3 Stories
Complete Report:
Part I: Are We Prepared? | Part II: Disaster Dollars
Part III: Lessons Learned | Part IV: Warning Signs
Part V: The Big One
Restaurants in avon
Tires in avon
Telecommunications in avon
Pizza Restaurants in avon
Beauty Salons in avon
Government in avon
Click for More
Powered by Local.com
Site Map
© 2013 Community Newspaper Holdings, Inc. · CNHI Classified Advertising Network · CNHI News Service
Associated Press content © 2013. All rights reserved. AP content may not be published, broadcast, rewritten or redistributed.
Our site is powered by Zope. Some parts of our site may require you to download the Flash Player Plugin.
Privacy Policy | AP News Registry privacy policy
Terms and Conditions
Advertiser Index
Hendricks County Flyer, Avon, IN 8109 Kingston St., Suite 500 Avon, IN 46123