Governor and Legislature and State Budget and State Government and Income taxes and Taxes and Government & Economic Development and Government

Pence moves outside Indy to find tax cut support

February 27, 2013

Indiana Gov. Mike Pence is taking his pitch for a 10-percent cut in the personal income tax around the state after failing to lock down support for his signature legislative priority inside the Statehouse.

Pence has spent more time on the road in his first two months in office than at the Statehouse, delivering a plea to voters and Republican activists at their annual fundraisers: Lobby your representatives and senators for your cut.

Meanwhile, his aides, led by former campaign field organizer Chris Crabtree, have started an online campaign to pressure wavering lawmakers. Working with them are Indiana tea partyers, led by the Indiana branch of Americans for Prosperity, which has bought radio ads and is coordinating its own online campaign.

"We are determined to continue to reach out to members of the state Legislature and to the people they serve in the four corners of this state with a message that Indiana is in a unique position where we have the ability to fund our priorities and reduce taxes for every Hoosier," Pence said shortly before taking the stage at the Hamilton County Republican Party's annual Lincoln Day Dinner earlier this month.

The cut is critically important to Pence, both because he made it the centerpiece of his campaign for governor and also because it could give him a strong piece of legislation to run on should he pursue a 2016 White House bid.

The freshman Republican governor has stuck tightly to a script that calls the tax cut the best job-creator and economic development tool available to the state. More recently, he's amended that pitch to include stories of other states where Republican governors are looking to cut their state's income taxes.

During a recent swing through South Bend, Pence found broad support for the cut at the Chicory Cafe.

Philip Schreiber, owner of the Chicory Cafe, said he favors Pence's plan because he believes it will help the economy. "Put the money into the pockets of the people who earned it. When you earn it, you'll spend it wisely," he said.

Pence's latest campaign comes just months after he narrowly won the governor's office, collecting $14 million for a barrage of gauzy campaign ads. This campaign is more subtle, focusing squarely on the state's broad base of Republican activists. Pence estimates that before lawmakers leave the Statehouse at the end of April, he'll have headlined at least 15 Lincoln Day Dinners with his call for the tax cut.

The clearest example that the strategy might be penetrating the Statehouse walls came in a letter House Speaker Brian Bosma wrote to local Republican Party leaders explaining his decision to swap the tax cut for more spending on roads and schools.

But there are some critical signs that Pence's team has forgone the basics of working lawmakers in favor of thinking outside the granite and marble box. When the Senate Tax and Fiscal Policy vetted his tax cut earlier this month, the lead Senate sponsor spoke in favor of the cut, as did other supporters. But Pence didn't send anyone to testify for the measure.

That may be because inside the Statehouse, Pence faces a distinct challenge from local leaders plugged in through longstanding relationships with their state representatives and senators.

The Association of Indiana Counties held a conference across the street from the Statehouse a little more than a week ago, with hundreds of county officials pressing state lawmakers to keep money for roads in the state's $30 billion budget. Many had seen county roads and bridges suffer as former Gov. Mitch Daniels built $2 billion cash reserves.

That pitch resonated in the budget House Republicans drafted that removed Pence's tax cut and replaced it, in part, with $500 million for local roads.

But Pence is getting some ground support of his own.

"The word is getting out there. My fear is we're going to lose this supermajority (in the House) if they don't listen to the people and start being fiscally conservative like they campaigned so hard for," said Monica Boyer, an Indiana tea party leader who helped oust former U.S. Sen. Richard Lugar and who has re-focused her attention on the Statehouse.

Boyer started a Facebook group, "Kitchen Table Activism," that debates issues like the tax cut and a state financing plan for the Indianapolis Motor Speedway. The next step, she said, will be pressing lawmakers on the tax cut and other issues this weekend during town hall meetings, not unlike how tea partyers stormed Congressional town halls in the summer of 2009.

"I think it's accountability. I think for so long we focused on national politics, and now we're bringing it home," Boyer said.

Bosma and other top House Republicans insist Pence's tax cut could make it back into the budget before lawmakers leave at the end of April. But the action, for now, moves to the Senate.

Senate President Pro Tem David Long, R-Fort Wayne, said any answer on the tax cut will have to wait until the state gets new tax collection forecasts in April. He argued that Pence could still claim victory at the end of the session even if lawmakers reject the tax cut.

"It's important to focus on the fact a lot is getting done. The income tax cut is getting a lot of attention, because it's topical, but is not a reflection of the governor's success," Long said. "Whether this income tax happens or not, it will be a very successful session for the governor. That'll be the cherry on top for him."

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