Hi, I'm Jon Schwantes, and on this week's show we'll look at our states love hate relationship with home rule, a concept that in theory gives locals a fair degree of autonomy, but in practice often takes a backseat to the prerogatives of the General Assembly.

Indiana lawmakers from the state House to your House.

Lawmakers is produced by WFYI in association with Indiana Public Broadcasting Stations.

Additional support is provided by the Indy Chamber, working to unite business and community to maintain a strong economy and quality of life.

Unlike the relationship between states and the federal government, municipalities are entirely reliant on the state government to outline their local rights, responsibilities, and degrees of autonomy.

While some matters are handled by state government, others are served locally.

In these cases, many states exercise the philosophy of home rule, yielding significant autonomy to municipalities.

The Indiana Home Rule Act, passed in 1980, provided local units of government the power they needed for, quote, effective operation while simultaneously reserving some power to the state.

Although this distinction remains vague, allowing the General Assembly to step in on quote affairs of statewide concern.

Recently, the state government claimed authority on a variety of matters.

Some local ordinances that were overruled include bans on certain pet sales, funding for public transit, penalties on obstinate landlords, and prohibiting right turns at red lights.

This session, proposed property tax cuts could impact funding for local governments affecting infrastructure.

Economic development.

Parks and libraries across Indiana.

I am pleased to welcome Republican Senator Aaron Freeman of Indianapolis, a former member of the Indianapolis City County Council.

Democratic Senator Faddy Qaddoura of Indianapolis, the city's former comptroller and CFO.

And Terre Haute Mayor Brandon Sakbun, who was recently appointed to the board of directors of Accelerate Indiana Municipalities, or Aim, the nonpartisan voice of Indiana's cities and towns since 1891. let's start very broadly here about the notion of the relationship between state and local government and the notion of home rule.

Thomas Jefferson kind of started.

You can't go wrong if you start a show with Thomas Jefferson, he said, of course, or credited with saying, the government closest to the people serves people the best.

Aaron Freeman, does Indiana live up to that?

Depends on the day.

Look, how about today?

Well, I haven't been to the statehouse yet, so we'll see what happens today.

look, all I've ever asked is for people to be consistent, right?

people need to pick a lane and stay in it.

And when you're asking a bunch of people that are in politics to do that, that's a really big challenge.

Some days.

So it's frustrating to somebody like me that walks in the building and then somebody last year has the position, what we're a local control state, so we can't possibly do this.

And then they do something completely that takes away so much local control this year.

It's just funny that it's in the eyes of the beholder and it kind of when it serves them, then they're all for it's great.

Say we're for local control.

I think it's really hard to practice.

look, I live in Indianapolis.

No, no question here.

I disagree with some things that go on in Indianapolis.

I'm elected by people that live in Indianapolis to go to the state and try to make it better for them.

So look, I'm going to shape and mold government to what I think it should be for folks that I represent.

And that's why I'm in the legislature to almost to do every day.

And you say folks should stay in their lane.

is that what is the lane?

Republicans have a lane.

Do Democrats have a lane?

Is that an oversimplification?

And I would point out for anybody who's been around the state House a lot of times there's a lot of lane changing.

To your point going on where members of a party, depending on the issue, may go back and forth and not see it necessarily as a departure from, from their from their path.

Is that I'll give you an example.

last year, look, I tried to rein in a local bus service that is taking away lanes of travel from people.

It was, the the blue line, dedicated lane.

And all for transit.

Right?

You don't have to take away lanes of travel from people when they're doing it.

So I go to a member of the house and I'm having this conversation.

Hey, I appreciate your vote on this.

And I just can't do it.

Oh, okay.

Tell me why.

Well, I'm a local control guy.

I just couldn't possibly take that local control away from people.

I said, well, that's funny because the day before, I stood on the Senate floor for two hours being called everything but a nice human because we were taking away local control from the city of Gary because we can't trust them to come up with their own gun laws.

And I remember your name was on the bill.

So I'm just curious where this local control it.

I'm just suggesting to you it's a really difficult thing to put into practice, and it's a really difficult thing to ask some politicians to, to kind of be consistent and stay in that lane.

And as far as you're concerned, Lane is not just a metaphor in that case, it's the real.

It's an actual fabric.

The door is this do by the interpretation that, the people should stay in their lane or where do you come down on these.

Sorts of issues?

I agree with my colleague, Senator Freeman.

I prefer consistency.

We at the state level, we dislike what the federal government tells us to do, and we trust the state government to be closer to the people every day.

So I try to apply that same analogy to our work at the state compared to the work of the locals.

I think our Indiana Constitution clearly articulates in article four, section 22, the that the powers of the locals, you know it is there in the Constitution for a reason, because government closes to the people, better understands those who they serve, and they respond to them more quickly than states government.

I agree also that we have to be mindful.

I tried over the last four years to be very consistent and allowing local control, and home rule, to be the theme of all of these pieces of legislation that impact our communities.

However, I also agree with Senator Freeman that there are instances when we talk about, for example, special legislation.

There's a, you know, a community that has certain problem that is so unique that does not exist statewide.

So occasionally there is switching of lanes because there's a community that is being impacted by specific problems that may not exist in other places in the state.

So I'm all for consistency, for nuanced policy discussions and for balancing the relationship between the state and the locals.

And there's not supposed to be specific legislation, but that always is fun to read.

A bill, for instance, about the Indianapolis Motor Speedway, and it's a facility in a first class city that hosts at least 250,000 people on a single day.

Mayor, you've been listening.

You you took office in January of 2024. when you got in office.

What surprised you about how much power you did have?

Vis-A-Vis the state and how much you didn't have vis-a-vis the state?

So, you know, actually, I think my my military experience shaped my leadership style a lot more than a.

Former captain in the, Army Rangers.

Yes, yes.

And I think a big reason is something that I learned, with special operations that I practice here in government is getting that bottom up style feedback.

So a great conversation in today's political world is efficiency.

And when you look at local government and how we've tried to be efficient in the city of Terre Haute, a lot of it is data driven decisions by the user and by the employee working in government.

And I say all that because I want to tie it to this local control conversation.

I concur with the two good senators here.

it can get frustrating to not see that consistency.

Where I'll slightly change my point, though, is what I don't like is the term staying in your lane, right?

At some point I do believe you have to be audacious and to be audacious.

There's a right way and a wrong way to do it.

The right way is to have conversations with these gentlemen, say, hey, look, here's how this statewide policies affecting me specifically, a great example is Senate Bill one, right.

The governor asked us to bring our data and present it to the state house of what?

That current version of the bill.

And I would just say this is property tax relief, which has an impact, obviously, on local government.

And so that's something that that I did.

I said, okay, under the current language of this bill, here's what we would be losing and here's everything we've already cut the last 20, 30 years in the city of Terre Haute, right.

And I appreciated that conversation because it's like, let's bring the data to the statehouse.

But I don't appreciate it when, other members of the legislature not these to use that conversation to say, oh, well, there's that young Democrat mayor saying we should keep taxes high.

Incorrect.

Now, all I'm doing is presenting the facts of the current bill that you are discussing at the state level and showing how it applies locally.

I don't think we asked enough local government elected officials about Senate Bill one, because in this bill, you'll see, well, we're going to give locals the opportunity to do local income taxes at the city and add more to the county rates.

And I said, whoa, whoa, whoa, why are we pushing this down?

You know, let's have a conversation about maybe we get away from income taxes and property taxes and look at other taxing revenue styles to help spread this out across, I don't know, maybe a sales tax on services so we can capture people from Michigan, Illinois, Ohio and Kentucky when they get services right here in the Hoosier State.

So that's kind of how I've always looked at it is, you know, you should get out of your lane, but in a respectful, pragmatic way.

I wasn't going to jump into fiscal policy right away, but let's do it.

You open the door.

and the reason I was going to shy away from it initially is we really don't know how these things are going to shake out because the revenue forecasts, the updated revenue forecast is still a few days away.

Kind of all bets are off.

And until then, and as we joke before taping, it's probably before the Gavel Falls signee died in the remaining hours of the session that we'll really know what happens.

But as long as the good mayor brought up this notion of property tax relief, I think you've heard from a lot of mayors and county officials and school officials who say you're killing us, with this.

If you if you take away even if we have the authority, we're still going to get yelled at because the taxpayers are still going to feel the bite.

The same way is how do you deal with that Here's what I know.

our property tax overall cost to folks when you look at the nation is pretty low.

I mean, we're in the top five of low property tax states, right.

We're also in the top five of complexity.

Right.

When you think about how that property tax bill gets to an individual city or the person in Terre Haute paying that tax bill, it's really complex and really difficult to figure out.

I think if we could move in a direction that makes it a lot more simpler, cleaner, somebody can understand it without, you know, hiring somebody like Faddy who's got that background to do that.

Right.

I think that'd be a lot better.

I think it'd be better for the cities to know some predictability and what their tax rate is going to be.

Look, I knocked on 15,000 doors last year.

There were two things people wanted to talk about.

They would ask me, what's your position on Trump and Biden?

You got that all the time.

And then inevitably it was if somebody had an issue, it was about property taxes.

So look, I'm more of the bold and courageous.

I'm a limited government, low tax kind of human.

I would be a little more bold and courageous.

I voted against Senate Bill one in the first half, an Army Ranger sitting next to me.

I get that, but, I voted no because it didn't go far enough for me.

I want to give tax relief in particular.

Property tax relief doesn't mean I'm not open to other ideas and other mechanisms and give the tools to this, to the locals to kind of make some of those local decisions to support Thomas Jefferson.

But look, let's see what the revenue forecast looks like.

And then sometime we're going to have to be bold and courageous.

And I'm willing to do it now.

And if I could do justice to those listening about your position on Trump, since that's one of the two questions, correct me if I'm wrong.

You said you love his policies and judicial appointments, but you'd like to take a cell phone and hit it with your truck.

because.

If we could remove the cell phone sometimes.

I'm guessing you meant the taxi.

A beautiful.

Thing.

All right, all right, let me just jump in here, because I really appreciate.

And I would agree, I think, and I won't speak for the two of them.

I think we all agree that tax relief is needed in the Hoosier state for select communities.

And my entire argument surrounding Senate Bill one is, yes, we did not go far enough in terms of property taxes.

But to be able to go further, we have to look at replacement revenue and using income tax as a replacement revenue source only hurts Hoosiers more because it's a regressive tax.

Now let's further define why we need the current system of property taxes.

The city of Terre Haute, our property taxes only go to wages and salaries.

Our streets are funded through state funding motor vehicle, highway, local road and street.

Our economic development projects all have to be stacked with a federal, state or private foundation grant just to get a morsel of quality of life projects.

So I say that I do support types of taxation.

Why?

Why?

Because I support police, I support fire, I support the education system.

I agree with the senators that we need tax relief, and I would just certainly hope that we can find a better replacement revenue source than income tax.

You brought up another leg of the fiscal stool, which is local road funding, because Purdue came out with a study before the session that said that there's a $500 million gap, not in the state maintained roads, but in local maintain roads just to keep roads functioning at their current capacity How battered and bruised will be financially when this session's over.

So I agree with my colleagues.

I like to think about things very systematically and look at not one piece of legislation, but all pieces of legislation and the collective impact of those pieces on property taxes and all fiscal matters.

There are several pieces of legislation, not only Senate Bill one, but Senate Bill 518, which was folded in Senate Bill one.

It impacts our local schools as far as shifting property tax dollars from traditional schools to charter schools.

There are other bills, such as House Bill 1515, which basically dilutes the regulation of where charter schools can be.

So you can have hundreds of schools that can open and that could impact the tax.

And that was a point of contention just in appropriations last week.

But so the point I'm trying to make here is that I fully support property tax relief, for which it has to be targeted.

It has to be smart, specifically who is on fixed income, senior citizens, veterans, and so on.

I did introduce this session, Senate Bill 394.

It had a mix of tax relief, not only just one type of tax relief.

my bill would have eliminated utility taxes on critical services such as water, electric and gas.

It would have created a sales holiday multiple times a year for families, and then it backed property tax relief by state revenues.

I'll conclude on that point by saying we as a state, prior to my time, the state made a decision that we will share property tax funding with our schools at a local level, meaning the state will not 100% fund our local public schools.

So they shifted the part of the burden of funding public education in the state of Indiana to the locals.

So when a school does not have ample resources or local government, they have to raise property taxes at the local level.

Go to the ballot and ask folks, can we get a little bit more out of your property taxes to fund our schools?

I think, and I have been arguing for four years, not only in Indiana, but on a national level.

I think it is immoral.

It should not be legal to fund our schools based on property taxes.

We should abolish that, and the state should be fully responsible for funding public education because a child should not.

Their future should not be determined based on the zip code that they live in.

If I live in a neighborhood with low assessed value, that means that my school will not be funded.

And now I have inequity across the state, so too we can bring $1 billion or more of property tax relief to all who judges across the state.

If we bring back public education funding to the state, We could spend the whole show talking about finances.

But it is important I respond to this.

I mean, you are giving more taxing capacity in some cases or encouraging the use of that capacity.

is it sort of hey, we want you to be, you know, more independent, call the shots, raise the money, but do it in this way, this way, this way and this way.

So, look, without ruining Faddy's career here, I love working with him, and he's a great colleague to work with, and we actually get along really well.

I don't.

You know, that's why we had to put the mayor.

Well, that's right, he.

The army captain.

He's had to be in the middle when Faddy says something like which, by the way, it's a policy question, right?

And he's not wrong.

I'm not right.

It's just he has a different opinion.

So when he says, hey, the state should take over control of schools and fund them, then my question is, well, is that so?

Where are we going to then dictate policy to the schools?

And we're going to tell them it just gets into that.

Well, there is some of that.

I mean, sure.

There's a guy.

That curriculum and.

I.

Made the on one hand, we're doing a lot of work in 1002 to deregulate schools.

And it's amazing to me the number of bills that we're going to vote on yet this week and next week that regulate the world out of schools.

I'll make one more point.

Look, I'm off.

I think if anybody in Indiana tells us our roads are in great shape, I would like to meet that person.

I whether in Terre Haute, Indianapolis, Richmond, wherever you go.

Our roads are a concern here.

It's been my point.

And this is where Faddy and I probably disagree slightly.

Right?

In 2016, when I was leaving the city county council, there's a report out that Indianapolis was $1 billion behind in infrastructure.

Right.

And instead of putting money towards that, we did a referendum and the state allowed a lot of money.

We're hundreds of millions of dollars into a bus service in Indianapolis that I would ask the person that thinks it's going really, really well, and you wait until you take away two lanes on Washington Street in a turn lane in the middle.

I want the person that supports that to come talk to me.

Right.

We've put all this money into a service, hundreds of millions of dollars that could have fixed roads, that could have fixed potholes.

I'm just suggesting so when the state collects money and gives it to the locals, there's got to be a respectful conversation with our mayors about how that money is you.

Just to be clear, though, I and I may be wrong here, but a lot of that money was federal dollars that may have been designated for.

Hundreds of millions of dollars of federal.

Dollars that were for mass transit.

Wouldn't necessarily.

I'm just saying you couldn't just arbitrarily the comptroller or CFO couldn't have shifted the money to.

That's a very good point.

I want to add is I oftentimes I follow a lot of our state legislators, online and I recently saw a state representative.

I know I said, and he was going on say, May we pay all these property taxes and it's not going to roads.

And I thought, oh my goodness, there are individuals, some of the newer ones to the state who have not sat down and looked at a city budget and understood that property taxes are in the general fund for wages and salaries, and it's actually the state helping us.

So thank you, gentlemen, by the way, with the Community Crossing Grant program and looking at expanding it.

Which is being capped, bringing it well services, cities.

But I hate to.

Be deliberate, but.

There's a reason why it is because it should be fair and in my argument, equitable.

If you're a smaller city, why are you getting the same amount of community crossing grant funding?

Is Terre Haute, Kokomo, Muncie, or even Indianapolis?

So when you look at the cap, it's because the scales overall changing based off of lane mileage.

And that's why there's a cap.

So I applaud them for looking at that.

But my point here being is when you look at a city's budget, exactly what you said, different projects or different funding streams are earmarked for different types of projects.

Economic development, income tax.

Right.

That is not traditionally a salaries and wages type budget.

And I always bring this point up to say when we talk about local control and local government, what I would love to see more of is state legislators needs to do a good job of it.

Getting more engaged in having more conversations with local elected officials so they could sit there and say, hey, you're road funding.

It's barely getting us back.

I mean, we've had to put a ton of gaming revenue into our road funding budget just to get back to fighting ground.

And thanks to their changes, knock on wood, these go well.

These next two weeks we'll have more opportunities because of the state.

But it took a lot of conversations with representatives who don't represent Terre Haute.

But thankfully they answered the call and they're willing to work on that.

That does not happen every day.

Not every mayor gets that treatment.

You know, in the budget discussions and in the property tax relief discussions, I don't know if this will ultimately see light of day, but taking tapping township government surpluses, which are sizable in some cases and using that.

is that a good idea to tap, the municipality or the government structure?

That's even below cities and towns.

I think at this stage, collaboration between different levels of government is where you can find innovation and you can find solutions.

So if there are surpluses and township capital funds at the township level that can be used for those purposes, I'm all for that discussion.

it is not either or.

It is all of the above type of solution.

And we are not that different than our ideas.

Actually, even with Senator Freeman, we do agree on or public transportation.

I think Senator Freeman is interested in efficient.

He frequently would say on the Senate floor that I'm not opposed to public transportation.

I just don't set aside that.

I just that so.

So that becomes this specific nuance policy issue for that locality.

But I think when I was the city comptroller, for example, one of the main requests that we were negotiating with an economic development when we were trying to attract global headquarters to Indianapolis or even large businesses from across the nation.

one of the top three questions was always, do you have transportation?

Six thousands of employees, for example, from downtown to the airport or vice versa.

So we do agree on the overall policies.

I think how you get there and the nuances, I don't think you will find a Republican and a Democrat disagree that we need to be efficient.

We need to do business in the way that best serves the people.

And we need to be very smart.

And how we utilize taxpayer dollars in the most efficient and most suitable way.

locals can't have gun ordinances.

They can't have, employee minimum, benefit requirements.

They can't, have single use plastic bags, etc., etc., etc.. the legislature and the state House is the most exhilarating place to work, and it is the most mind numbingly frustrating place to work.

And in the same day, I mean, it it is a roller coaster sometimes in the, the, the issues that we tackle your township question to Faddy just a second ago, right?

I mean, I hope you see us say that there at least needs to be a vote at the local level to give those dollars so that it's not this the state coming in and taking them.

I hope I will have an amendment to that effect that that there's actually a vote.

And then I hope we can agree that if those local, if they do vote and if those local dollars are going to go for road funding, in this case, I hope it stays in that township.

I hope we're not pulling money from one township to another.

I hope we can agree as a, as a body that that money should stay in that township.

So maybe it will.

And maybe though in terms of roads that cross.

Well that's your township.

Well that's right.

But then there needs to be a match between the townships.

I wouldn't want to see a township lose their dollars and go to a different township, even on that level.

So look, I'm not completely taking away local.

I absolutely think there needs to be some local control.

I I'm just probably more than any most people in the state House willing to say, look, there's there's occasions where we're going to interject it's state dollars going and just is the conversation about schools.

So at what level do you put strings on that money?

And then I.

Just wanted to hop in.

I know we're talking a lot about Indianapolis transportation, so I'm going to kind of blow your socks off and talk about Terre Haute transportation.

90% of our transit is funded by state and federal dollars in the city of Terre Haute.

I'm not quite sure the ratio in Indianapolis.

So for our local match, instead of using transit fares, we use gaming tax revenue that lead to a 100% increase in our transportation in the city of Terre Haute.

And we didn't take away any lanes.

The reason being is we wanted to connect employees to employers.

So we synchronized transit with workforce development programs and job fairs and adult education programs to grow our median income.

We do all three of those to grow our tax base.

You spend all the time doing that, and then you go up to Indianapolis and you hear, oh, wait, no, now we have to change this or that.

So I agree with him.

If the state is moving in an issue like transit with state dollars, yes, correct.

They need to get involved.

When it doesn't, I go, oh my gosh, I just spent months trying to grow our median income connecting, you know, kind of like a point guard pass in the rock.

And now I'm like, I gotta reset the office.

I'm just hearing that you're suggesting that under the home rule principle, that cities and disparity should be able to start their own casinos at their own discretion.

On going.

And wouldn't that be all right now?

We're down under.

Good filibuster there.

you've got a future in politics.

Real quick, though.

What's the one thing that's out of kilter now?

If you could change one thing about the balance, what would it be between local government and state government?

I think the consistency piece and nuanced approach and systematic approach to the way we do legislation.

I'm not saying this in any negative way, but unfortunately, the nature of the General Assembly is that we are very, transactional people look at each piece of legislation and there's not their ability to pull back and look at the entire picture.

And second, the nature of elections.

Every two years you have new folks coming in.

So, you know, elected officials are focused on what can I accomplish in the next two years from my local community versus the state.

I want to take some wins back to my district.

So these are complicated discussions that we have to balance and to be sure that we're truly protecting the locals.

We're giving them resources.

We're holding them accountable.

But I am in the in the view or in favor of collaboration, collaboration, collaboration, open communications and consistency in the way that we work with one another.

Anything out of kilter, Excellent.

I agree with that.

Consistency is an issue.

It's easy for legislators to say, I want to deregulate schools, for example, and then the first time there's an issue, boy, we're regulating the world out of schools.

So all right, we agree consistency.

All right gentlemen, thank you very much.

Obviously important topic.

And I appreciate the passion and expertise you share.

with our viewers.

And I appreciate you again.

My guests have been Republican Senator Aaron Freeman of Indianapolis, Democratic Senator Faddy Qaddoura of Indianapolis and Terre Haute Mayor Brandon Sakbun.

And time now for our weekly conversation with Indiana Lawmakers analyst Ed Feigenbaum, publisher of the newsletter Indiana Legislative Insight, part of Hanna News Service and local government.

The friction between local in the state.

What do you what's your take on this?

Well, it's interesting that that local government is almost the farm system for the General Assembly.

And, and Senator Ghidorah and Senator Freeman both came from there.

And it seems like everybody likes local government wants to let them do what they need to do and respects Home Rule until they do something that they just don't like.

And that we've seen those there so many preemption whether I joked about the plastic bags.

But it's also benefits.

It's gun rules.

So diet landlord rights and so forth.

Is there any city that has weathered the storm better than than others?

Well, I think you can point to Gary as perhaps being able to overcome this going forward.

They've got a mayor who came from the Senate, a mayor who, when he was in the Senate, actually had a vision for the city that he tried to accomplish through legislation in the Senate.

The head of the Geary Sanitary District Board is a member of the Indiana House.

And I think that when you've got those kinds of relationships, there's bound to be a little bit more trust.

And I think they'll give Gary a little bit more leeway going forward.

And they've given some of the other mayors of Gary and some of the other mayors around the state.

So instead of going from mayor to the statehouse, you should go statehouse to the mayor's office, I guess is what it is always.

Appreciate your insight.

Thank you Jon.

Ensuring adequate and affordable childcare for the kids of working Hoosiers is proving to be anything but child's play on the next Indiana Lawmakers.

Indiana Lawmakers is produced by WFYI in association with Indiana Public Broadcasting Stations.

Additional support is provided by the Indy Chamber, working to unite business and community to maintain a strong economy and quality of life.