Key business issues clear mid-session hurdle

February 3, 2010

Two key issues for business groupsdelaying a hike in unemployment insurance taxes and reforming local governmentcleared major hurdles this week in the Indiana General Assembly.

The first half of a short session will close Wednesday, meaning bills must have passed out of either the House or Senate to stay alive. Legislation regarding unemployment taxes and township-government reform easily met that deadline.

The Senate passed a bill that would delay for one year a planned 70-percent increase in the amount of unemployment taxes paid by employers. The bulk of the burden, an estimated $400 million, was expected to fall to manufacturers and the construction industry.

“This is our main event for this sessionby far,” said Pat Kiely, president of the Indiana Manufacturers Association.

Kiely is now focused on the Democrat-controlled House, which does not have its own version of the unemployment taxes bill. “It’s really in their hands,” he said. “So far they’ve been working with us. Conversations are cordial.”

The Indiana Chamber of Commerce joined the effort to delay the unemployment tax hike, while also pushing to eliminate township governments and trying in vain to stop a National Rifle Association initiative.

Chamber President Kevin Brinegar was glad to see that township government reform will be a live issue when the General Assembly reconvenes next week. “It’s not exactly in the shape we want it in, but we’re pleased,” he said.

The House bill would have voters in each township decide by referendum whether to keep that form of government.

The Senate bill would eliminate townships’ boards of trustees and hand budgetary oversight to county councils. The Chamber is asking members to voice their support of the Senate version.

Despite disapproval from the Chamber of Commerce and the Manufacturers Association, both the House and Senate passed bills that prevent most employers from banning their employees from keeping firearms in their vehicles while parked on company property.

“The Second Amendment protects you from your government, not your employerthat’s what we tried to argue,” Kiely said.

Representatives from Eli Lilly and Co. and Cummins Inc. showed up at the Statehouse to testify against the bill, Kiely said.

Stakes were high this session for those who make a living on food, drink and gambling.

Indiana-based alcohol distributors hoped lawmakers would shore up their defense against Southern Wine & Spirits. The Miami-based wholesaler is trying to enter the market and has challenged an Indiana law that requires alcohol distributors to have their headquarters in the state. Senate Bill 244 reiterated that post-Prohibition era residency requirement, but it failed to get a vote on Tuesday.

Lawmakers will continue to grapple with the future of the state’s casinos when they return next week.

Gambling is a $2.7 billion industry and the state’s third-largest source of tax revenue, but it could soon face competition from Ohio and Kentucky. Currently, casino gambling is confined to boats on Lake Michigan, the Ohio River and an artificial moat in French Lick. Central Indiana has two racetracks with electronic games, but no cards or dice.

Late Tuesday evening, the Senate passed a bill that many members felt would make the existing industry more competitive but not expand its physical presence.  The bill contains no provision for land-based casinos, which would have paved the way for a new casino in northwest Indiana, and possibly one near Fort Wayne.

The bill that will move to the House tweaks the law in several areas. It allows riverboats to remove their navigation equipment and the “racinos” to handle Internet-based betting on horse races. All types of facilities could add card tournaments, serve free drinks and expand their marketing.

The bill also lowers the admission tax at French Lick from $4 to $3 per person and requires entities participating in local revenue sharing to demonstrate that they serve a public purpose.

Land-based casinos might get a second chance in the House, but Ed Feigenbaum, publisher of Indiana Gaming Insight, cautioned that the issue won’t be resolved easily.

The move to land would open new areas of the state to casino gambling, while pulling traffic away from others, he said. “There’s going to be a lot of alliances formed between companies and communities.”


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