General Assembly Overview
Late in the evening, the Indiana General Assembly wrapped up all business for the year on Wednesday, April 24, five days earlier than the required date.
Of the 1,347 bills filed, 293 successfully navigated the legislative process and may soon become law. Governor Eric Holcomb is expected to sign a vast majority, if not all, legislation in the coming weeks.
In what came as a surprise to many, Rep. Dave Frizzell (R-Indianapolis) announced his retirement from the state legislature. Frizzell, who was the chairman of the House Family, Children and Human Affairs Committee, spent 27 years representing the southern portion of Indianapolis. Frizzell will be retiring from his position June 30.
Last Tuesday, GOP leaders unveiled the final version of the state’s biennial budget. Those in attendance included Governor Holcomb, House Speaker Brian Bosma (R-Indianapolis), and Senate President Pro Tem Rodric Bray (R-Martinsville). HEA 1001 was the only measure lawmakers were mandated to pass, and in what was the last piece of legislation acted on by both chambers, the Senate approved the budget 41-8 while the House supported it 67-31 on its final passage. Sen. David Niezgodski (D-South Bend) was the sole democrat who voted in favor of the bill. Highlights of the $34.6 billion budget include:
- $147.4 million two-year expected surplus for the state, keeping total reserves over $2 billion.
- $736 million increase in K-12 education.
- $502 million increase to the budget for the Indiana Department of Child Services. The first budget proposal from the House allocated the full $572 million increase originally requested from DCS. However, lawmakers say the agency has seen improvements over the past few months and no longer require the full amount.
- $1 billion funding for infrastructure projects, including interstate improvements, trails, and rural broadband development.
- Doubles the funding available for the Next Level Employer Training Grants (from $10 million a year to $20 million) and Workforce Ready Grants ($2 million to $4 million a year).
A final version of the budget faced a late obstacle when legislators discovered the expected revenue for the state was $100 million less than what was initially forecasted.
The budget faced criticism from Democratic legislators for what some believed to be an excessive amount of reserves, not funding certain programs, such as the Amtrak Hoosier State line that runs from Indianapolis to Chicago, and prioritizing issues they believed were not crucial to the state.
The full state budget for Fiscal Years 2020 and 2021 can be found here.
Perhaps the most controversial issue was wrapped up fairly early on. The hate crimes issue, originally Senate Bill 12, passed out the Senate in the first half of session after Sen. Aaron Freeman (R-Indianapolis) amended the bill to remove the list of victim characteristics. This change caused Sen. Ron Alting (R-Lafayette), one of the bill’s co- authors, to join Democrats in voting against the bill.
Instead of giving SB 12 a hearing in the House Courts and Criminal Code Committee, House legislators opted to insert their own bias crimes language into Senate Enrolled Act 198, a bill that originally dealt with increasing the penalty for using and selling controlled substances on a juvenile facility. The House’s language, authored by Rep. Greg Steuerwald (R-Avon), allows a judge to consider if a crime was committed with bias due to a victim’s real or perceived characteristic as already laid out in Indiana code.
Despite pushback from local businesses and Democratic legislators, SB 198 passed out of the House 57-39, was concurred on in the Senate 34- 14, and was signed into law by the Governor on April 3.
Marion County Capital Improvement Board
Legislation that will keep the Indiana Pacers at Bankers Life Fieldhouse for 25 more years and allow for the construction of a $150 million soccer stadium successfully advanced to the governor in the final days of session.
SEA 7 went through several changes while navigating the legislative process. However, the final version of the bill establishes the fiscal mechanism the CIB can use to fulfill its 25 year vision. In addition, the House Ways and Means Committee removed the provision requiring a soccer franchise to agree to a deal with Major League Soccer prior to constructing a stadium.
After originally dissenting with changes made by the House, the Senate withdrew its dissent decision and concurred with House amendments on SEA 7 44-4.
As of September 1, adults over the age of 21 will be able to legally wager on sporting events as part of the General Assembly passing HEA 1015. What was originally SB 552, all gaming language was amended into HB 1015 due to Indiana law requiring all income generating provisions be originated in House bills. The 9.5 percent tax rate placed on sports bets is the primary income generating provision requiring the change.
Sen. Mark Messmer (R-Jasper), the bill’s main author, described the legislation as “the type of opportunity that won’t come again in our lifetime.” In addition to sports wagering, HEA 1015 moves up the date allowing live-dealer table games at horse- track casinos and allows for the owner of a Gary casino to relocate the casino located on Lake Michigan to another location in Gary for a $20 million fee – $80 million less than what was originally proposed.
Also in the bill is a provision to allow for a new casino to open in Terre Haute pending a referendum vote in Vigo County, where Terre Haute is located. Potential casino operators would then submit proposals to the Indiana Gaming Commission in order to operate the new casino. If all of the provisions of HEA 1015 are met, Indiana would have a total of 12 traditional casinos and two horse track casinos.
The final version received mixed support from both sides of the isle. It was adopted in the House 59-36, notably receiving a no vote from the bill’s primary House sponsor. It then passed through the Senate 37-12, with the only no votes coming from Republican members. HEA 1015 is now eligible for action by Governor Holcomb, where it could be signed into law.
The 2018 Farm Bill permanently removed hemp from the federal Controlled Substances Act. As a result, hemp is now treated like a regulated agricultural commodity and is no longer misaligned with marijuana. In response to this federal legislation, the General Assembly passed SEA 516, which is the landmark hemp legislation that legalizes the commercial production of hemp in Indiana.
SEA 516 requires the State Seed Commissioner to develop a state regulatory program for hemp production in Indiana, which ensures Hoosier farmers operate under a tailor-made regulatory structure as opposed to a one-size fits all approach from the federal government. It also establishes the Indiana Hemp Advisory Committee (IHAC) to work collaboratively with the State Seed Commissioner in the development of our regulatory structure. IHAC consists of subject experts in the hemp industry and other established agricultural stakeholders and has a two year sunset duration.
SEA 516 also criminalizes the possession and sale of “smokable” hemp in Indiana beginning July 1, 2019.
The new two-year state budget makes a record investment in K-12 education. The $763 million in new money is more than either version of the budget previously passed by the House and the Senate, which equates to about a 4.5 percent increase each year for K-12 funding when looking inside and outside the school funding formula. A few of the highlights from the budget include:
- 2.5 percent increase in formula funding over the biennium.
- $5 million increase each year dedicated to ELL funding.
- $15 million increase for the Teacher Achievement Grant.
- $150 million toward the Post-1996 Teacher’s Retirement Fund, reducing schools’ obligation from 7.5 percent to 5.5 percent.
- A hold harmless provision to mitigate certain complexity funding loses.
- A request for a summer study committee to examine the complexity formula.
- Funding newly created programs created by HEA 1008 (Teacher and Student Advancement Grant Program) and HEA 1009 (Teacher Residency Grant Pilot Program).
Other bills of interest in the education sector include HEA 1003, which focuses on school corporation expenditure targets, and HEA 1005 that amends the date for Indiana’s first secretary of education.
HEA 1003 will encourage schools to make “every reasonable effort” to not transfer more than 15 percent of its budgeted spending out of the education fund. Any school not accomplishing the request would be required to publicly acknowledge the shortcoming and explain its expenditures. Lawmakers believe this push toward more money in the education fund will trickle down to teacher salaries.
House Speaker Brian Bosma’s legislation will move up the date for the first appointed state secretary of education from 2025 to 2021. Bosma’s reasoning for HEA 1005 was the sudden announcement from current state superintendent Jennifer McCormick that she would not seek re-election in 2020. This legislation was one of the first bills signed by the governor in early April.
Addressing Indiana’s high mortality rate, currently seventh highest in the country at 7.3 percent (Indiana State Department of Health, 2018), was one of the priorities of both the Governor and the General Assembly during the session.
- Rep. Cindy Kirchhofer (R-Beech Grove) brought fourth HEA 1007 which would establish a perinatal navigator pilot program to provide referrals for services and home- visit programs in Indiana’s 13 highest risk counties in addition to allowing medical providers to screen for signs of substance abuse in pregnant women.
- HEA 1547, also authored by Kirchhofer, allows minors ages 16-17 to make decisions on their healthcare during and immediately after pregnancy without their parents’ consent. Previously, Indiana law generally did not approve of minors making decisions regarding their own healthcare. A similar bill died in the first half of session due to
- concerns of parents being left out of the process completely. HEA 1547, which passed out of both chambers unanimously, requires physicians to try to contact the pregnant teen’s parents.
In addition to those bills, the state budget granted Medicaid an additional $65 million on top of what was requested by the Family and Social Services Administration, resulting in a grand total of nearly $2.5 billion in funding for the Medicaid Assistance fund.
HB 1444, which would have been the first tax on e-cigarettes in Indiana, failed on the last day of session. What began as a 20 percent tax was transformed into a study committee, but then dropped to a 5 percent proposed tax. Legislators ultimately believed the tax was too low to be considered effective and, from a public health standpoint, it would not have the desirable deterrence effect on children.
Notably, four bills that would remove or alter practice agreement requirements for advanced practice registered nurses were proposed this session, none of which passed. HB 1464 and SB 343 both died on second reading after being met with strong opposition in the House; while HB 1097 and SB 394 died after failing to be called down before the third reading deadline.
Multiple firearms bills saw movement throughout the session. Bills passed ranging from civil immunity to increasing the punishment for transferring machine guns to minors.
Recently, the governor signed HEA 1284, or what has been called the “stand your ground law,” in front of attendees at the National Rifle Association Convention in downtown Indianapolis. Originally, the legislation solely focused on giving civil immunity for individuals who use justified force in certain circumstances. Later in the session, language was amended into the bill to establish guidelines for people carrying firearms in churches located on school property and changed certain gun licensing regulations.
Other gun bills on their way to the governor include HEA 1651, also known as the “red flag law”, which aims to keep guns out of the hands of dangerous individuals and SEA 119, which will increase the punishment for transferring ownership or possession of a machine gun to anyone under the age of 18 up to a Level 3 felony.
One bill that failed to get its conference committee adopted in the final days of session was HB 1253. Rep. Jim Lucas’s (R-Seymour) legislation would have allowed school corporations to use state grants to pay for specialized weapons training for teachers and staff. Controversy surrounding live projectiles being used in training sessions may have contributed to the bills failure.
Rep. Ben Smaltz (R-Auburn) was the author of this year’s comprehensive alcohol legislation. HEA 1518 went through a plethora of changes on its way to the governor’s desk. The final version of the bill, most notably, features the language permitting the future $300 million Bottleworks District on Mass Ave. to own a special $50,000 alcohol permit in order to allow all of its vendors to sell alcohol. Smaltz’s language also contains enabling language for selling alcohol for carryout at the State Fairgrounds and selling liquor from golf carts.
Farm wineries and artisan distilleries are now allowed to be the proprietors of a restaurant and transfer alcohol to the restaurant from its winery or distillery thanks to SEA 609; and SEA 179 will amend the definition of “entertainment” to add elements for purposes of alcohol regulation.
There were two primary abortion-related bills that were discussed and passed during this session.
- HEA 1211, authored by Rep. Peggy Mayfield (R-Martinsville), is already the subject of a lawsuit by the ACLU of Indiana against the State. The bill would nearly ban a common second-trimester procedure except when the mother’s life is at risk.
- Sen. Liz Brown (R-Fort Wayne) authored SEA 201, which will expand the list of health care professionals who can opt out of providing abortion related services based on religious or moral objections.
Both bills advanced out of the chambers down party lines with the lone exception being Sen. Phil Boots (R-Crawfordsville), who joined Democrats in voting against both bills.
Utilities and Transportation
Various topics regarding utilities were introduced during this session.
- What was largely regarded as the “data center” bill, HEA 1405 gives tax exemptions to data centers when purchasing equipment. Senator Mark Messmer said his legislation could be the biggest economic development bill of the session.
- Rep. Ed Soliday (R-Valparaiso) authored language in HEA 1278 establishing the 21st Century Energy Policy Development Task Force. The task force would be responsible for evaluating aspects of the state’s electric generation portfolios and ensure Indiana is equipped to meet future electric utility needs. Notably,an18monthmoratorium on any final IURC approvals of filings for a Certificate of Public Convenience and Necessity (CPCN) or purchase power agreements over a 250 MW threshold was not approved by the Legislature.
- To address one of Governor Holcomb’s priorities, Sen. Messmer also authored SEA 460 to establish the rural broadband fund to provide broadband service providers grants for broadband projects in rural areas of Indiana.
- SEA 471 increases penalties for those who trespass or vandalize property that is considered a “critical infrastructure facility.” Examples of these types of facilities would be a fenced-in area that houses chemical plants, steelmaking facilities, electric utility facilities, natural gas facilities, transportation facilities (railroad switching yard, port or trucking terminal), pharmaceutical facilities, or telecommunications equipment. The measure received some backlash from organizations that believe the bill could infringe on free speech rights under the First Amendment to peacefully protest near any of the above mentioned properties.
In what has become an increasingly popular industry, Rep. Sean Eberhart (R-Shelbyville) authored legislation setting guardrails on the peer to peer vehicle sharing industry. HEA 1362 defines “peer to peer vehicle sharing” in Indiana code and establishes requirements regarding safety and insurance policies. Peer to peer car sharing allows car owners to rent out their vehicles to others via a phone app.
Unlike peer to peer services, Indiana lawmakers decided to extend the prohibition on all subscription auto sales with HEA 1237. Rather than buying or leasing vehicles, a subscription service allows an individual to pay an all-inclusive monthly
fee, typically covering maintenance and insurance, and gives them the ability to swap cars within days’ notice, depending on the program. HEA 1237 will extend the ban on the service another year to May 2020 while stakeholders work on a permanent plan.
HEA 1482 was a broad transportation bill that codifies several existing rules dealing with salvage recyclers, temporary license plates, and altering the composition of the Motor Vehicle Sales Advisory Board, in addition to various other technical changes. Notably, the bill adds provisions regarding uniform warranty reimbursement between auto manufacturers and auto dealers.
HEA 1470 amends the Transmission, Distribution, and Storage Improvement Charges (TDSIC) statute and applies to investor-owned utilities. HEA 1470 provides a new streamlined cost recovery process for infrastructure projects under which the IURC would approve new TDSIC plans that are filed by utilities if they are found to be “reasonable”.
The Legislative Council will now begin the process of determining what topics will be studied during the interim and assigning those topics to summer study committees.
As of writing, Governor Holcomb has yet to act on 128 of the 293 bills that advanced through the legislature. You can continue to track what the Governor has and has not signed at iga.in.gov.
ISAHU Priority Legislation
HEA 1588 Insurance Matters (Rep. Carbaugh): Requires a pharmacy benefit manager doing business in Indiana to, at least every seven days, update and make available to pharmacies maximum allowable cost list information. Repeals the law providing for availability of high risk property coverage under the federal Urban Property Protection and Reinsurance Act of 1968. Exempts flood insurance policies from the kinds of policies under which mine subsidence coverage must be made available. Repeals the law concerning the small employer voluntary reinsurance program. Urges the legislative council to assign to an interim study committee the topic of regulation and practice of pharmacy benefit managers for study and recommendations during the 2019 interim of the general assembly.
During conference committee the bill was amended as follows: removed language regarding the political subdivision risk management fund; added language requiring a pharmacy benefit manager doing business in Indiana to, at least every seven days, update and make available to pharmacies maximum allowable cost list information; and, added language requesting a summer study committee on the regulation of pharmacy benefit managers. The House and Senate concurred with the conference committee report and the Act is on its way to the Governor for consideration.
HEA 1631 Short Term Insurance Plans (Rep. Carbaugh): Specifies certain coverage and disclosures that must be provided with respect to a short term insurance plan, including renewal, without underwriting, for the greater of 36 months or the maximum period permitted under federal law, a term of not more than 364 days, and an annual limit of at least $2,000,000. Specifies requirements for preferred provider organizations used with short term insurance plans.
The bill was amended in conference committee as follows: changed the short term insurance plan language to permit renewal, without underwriting, of a short term insurance plan for the greater of 36 months or the period permitted by federal law; and removed a provision requiring an insurer to offset at least one short term insurance plan that meets certain requirements. The conference committee report was adopted by the House and Senate and the Act is now on its way to the Governor for consideration.
SEA 392 Medicare Supplement and Medicaid Study (Sen. Houchin): Requires an insurer that makes a Medicare supplement policy available to an individual eligible for Medicare based on age to make at least one “Plan A” Medicare supplement policy available to an individual eligible for Medicare based on disability. Specifies enrollment and insurance producer compensation requirements that apply to the “Plan
A” policy. Requires the Medicaid advisory committee to study and make recommendations before November 1, 2019, concerning Medicaid reimbursement and school based health centers.
During the conference committee process the Act was amended as follows: removed language concerning preexisting conditions, Medicaid reimbursement for rehabilitation option services, and short term insurance plans; inserted a provision requiring the Medicaid advisory committee to study and make recommendations before November 1, 2019, concerning Medicaid reimbursement and school based health centers. The House (98-0) and Senate (48-1) adopted the conference committee report and the Act is on its way to the Governor for consideration.