FEIGENBAUM: Constitutional question derails right-to-work dealmaking

January 21, 2012

Even before the first full month of the year has passed, every conceivable metaphor for the importance of the right-to-work issue in the 2012 legislative session has been (ab)used.

Suffice it to say that it was the key subject overhanging the session, and remains so, regardless of developments between now and March adjournment.

After a grueling joint House-Senate committee hearing, a House committee rammed through the bill in six minutes a few days later without even considering amendments.

Democrats threatened to walk again. Cooler heads seemed to prevail, as House Speaker Brian Bosma, R-Indianapolis, chagrined by the hearing’s reception, agreed to accommodate Democratic amendments on the House floor, including one that could have technically been out of order, a call for a statewide right-to-work referendum.

On Jan. 17, the House was to consider amendments in a marathon session. However, as we’ve become accustomed to experiencing in the past year, the unaccustomed intervened and the atmosphere grew poisonous.

Democrats discovered their referendum language might be unconstitutional. They regrouped, triggering threats of fines and unleashing vitriol between party leaders. The future of the session again became as murky as the Indianapolis Colts’ quarterback situation. (For strategic reasons, the Senate right-to-work bill is being held until its House fate is clear.)

Amid the right-to-work fireworks, a trio of high-profile issues seems to be orphaned three short weeks into the session.

Republican Lt. Gov. Becky Skillman offered a series of recommendations for local government reforms at the beginning of the session emanating from her statewide listening tour.

The key initiative: allowing cash-strapped and services-poor local governments to hold referendums allowing residents to decide whether local property taxes should be increased to bolster budgets. While local officials were enthusiastic about another tool for their fiscal toolboxes, it generated no groundswell of legislative support from solons reluctant to be perceived as paving the way for higher taxes.

The carefully crafted plans of central Indiana business and community leaders to begin the process for a collar-county mass transit district by allowing voters in some areas to weigh in on a local tax hike drew praise from key lawmakers. However, House Committee on Ways and Means Chairman Jeff Espich, R-Uniondale, found it difficult to find a co-author to ardently champion the package.

The anti-tax environment explains why the concept languishes, even though lawmakers wouldn’t be directly voting to raise taxes. They merely would be allowing voters to decide if they were willing to be taxed for the purpose. Apparently, some lawmakers believe Hoosiers can’t (or won’t) separate reality from perception—and many lawmakers from outside the doughnut simply don’t see why they should let themselves be tarred.

Even though consensus loomed on a major cost-saving sentencing reform measure before the 2011 legislative session, it crashed over concern about the perception of freeing too many inmates and reducing some sentences. A summer study panel had reached accord on basic elements, but prosecutors remained unhappy, and the governor was among those who initially championed the bundle but backed off.

While lawmakers don’t seem to be willing to allow any serious tax or fee hikes, they are also wary of making unpopular cuts to save serious cash.

Grover Norquist and his Americans for Tax Reform have inserted themselves into the Indiana policy debate, further complicating efforts over fiscal trade-offs.

Norquist wrote to Senate Committee on Appropriations Chairman Luke Kenley, R-Noblesville, opposing Kenley’s proposal to repeal the so-called “death tax” and pay for it by requiring online retailers to remit sales tax to the state on purchases by Hoosier consumers.

Kenley fired back, adroitly thanking Norquist for endorsing his inheritance-tax abolition efforts and educating him on the nuances of Indiana tax law and policy.

Kenley explained that the online sales tax he seeks enforcement of “is already due, but remains largely uncollected,” and he chose this effectively foregone revenue “to eliminate the inheritance tax rather than to fund another government program.”

He added that the sales tax “is a tax on the consumer, not the Internet,” and reminded Norquist that “none of us who try to achieve low taxes argue that illegal tax avoidance is an appropriate way to achieve our goal.”•


Feigenbaum publishes Indiana Legislative Insight. His column appears weekly when the General Assembly is in session. He can be reached at edf@ingrouponline.com.


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