The Senate passed a mass transit bill 28-20 on Tuesday that’s meant to give central Indiana officials authority to impose new taxes to pay for an expanded bus system for the region.
Senate Bill 176 could mean higher taxes for individuals and corporations—but only if county officials vote to impose them and voters agree via county referendums.
The bill now moves to the House, where it’s likely to undergo changes. House Speaker Brian Bosma, R-Indianapolis, said Tuesday that his caucus is concerned about the mix of taxes. In the past, the House has passed mass-transit bills that permitted local income tax increases but never higher taxes on businesses.
“I am pleased to see this legislation move forward," Indianapolis Mayor Greg Ballard said in a prepared statement. "Convenient and reliable transportation is critical to attracting new residents and is crucial to the future growth of central Indiana. We have been nationally recognized over the last few years as a great place to live, work and raise a family. A modern, regional mass-transit system is the next step to drive central Indiana forward as an economic engine for our state.”
SB 176 also requires that at least 25 percent of the operating costs for the system come from user fares.
The bill is “going to need some work,” Bosma said. “The concept we agree on. The means of getting there has been the difficulty for a decade.”
The bill passed a Senate committee last week – but without Democratic support. That’s because Republicans included language that would prohibit labor from using binding arbitration to set wages and transfer the authority to issue debt to Gov. Mike Pence’s administration from the Indianapolis-Marion County City-County Council.
The Senate voted on Monday to strip the debt language out of the bill. But the arbitration language remained, drawing criticism from a number of Democrats.
“These labor dispute issues have no business in a transit bill,” said Sen. Karen Tallian, D-Portage.
Still, Tallian voted for the bill, saying she cares enough about the underlying mass-transit proposal to keep the legislation moving through the process.
Sen. Jean Breaux, D-Indianapolis, said she’s concerned that the state and city of Indianapolis could lose federal transit funding if the legislature sticks with the ban on binding arbitration.
“We don’t need to undermine working men and women with a partisan bill,” she said.
Americans for Prosperity, a group that fights for smaller government, said it was disappointed in the bill's advancement.
“The Indiana Senate just opened the door to the possibility of $125 million in new taxes for many central Indiana residents,” said Chase Downham, Indiana state director for AFP, in a prepared statement. “Although this is a setback, we never expected this to be an easy fight. We will continue as we have always to stand up for Hoosier taxpayers and job creators as this issue moves to the Indiana House for further debate.”