Welcome to Politically Speaking I'm Elizabeth Bennion, Chancellor's Professor of Political Science and Director of Community Engagement and the American Democracy Project at Indiana University, South Bend.

The Indiana General Assembly has wrapped its 2023 session.

Lawmakers passed a $43 billion budget for the next two years, as well as numerous other bills over the course of the last four months.

Joining us to discuss the 2023 legislative session are Brandon Smith, Statehouse Bureau Chief for Indiana Public Broadcasting, and Nikki Kelly, Editor-in-Chief for the Indiana Capital Chronicle.

Thank you both for being here.

Happy to do it.

Thanks for having us.

I want to just start by asking you your impression of the final hours of the legislative session.

What were they like, Nikki?

Well, it was actually a little more chaotic and busy than normal.

And that is all because the leaders had announced a budget deal on a Wednesday.

And usually that means it's all in the bag.

You know, they've got it worked out.

They've got the votes.

They had PowerPoints and everything.

And then the next morning, morning, we started hearing that there were some Senate Republicans, especially, who were unhappy with the level of education funding.

And so that caused a rework in the budget on that final day and ultimately pushed it til, you know, the wee hours of the morning.

Brandon, how unusual is that to have those last minute negotiations and that late night scrambling?

Yeah, the thing I was going to say about the final hours of the session was there were too many of them.

We finished with the Senate, finished at 2:47 a.m..

It's extremely unusual to have these kind of last minute negotiations on the budget.

It's not unusual to see scrambling or reworking of legislation or trying to finalize these deals on other pieces of legislation.

We've seen that over the years, many, many times.

In fact, in 2018, those negotiations took too long and they ended up having to finish the session without getting some of their work done.

But on the budget, like Nikki pointed out, normally the day before they end the session, they come out with the final version.

The House has a rule that the budget is supposed to be made public 24 hours before they pass it.

They had to ultimately waive that rule to accommodate that last minute influx of education dollars.

But it's extremely unusual because especially when you have supermajority Republicans in both chambers, they're they're haggling over things.

Certainly there is plenty of that, but they generally have come to that agreement with plenty of time to spare.

And so this was definitely a weirder last day of session than we've seen in a little while.

Was there an actual danger that enough people would descend to I mean, they have to pass the budget?

Does that?

Yeah, I don't think there was never any danger of that.

What we heard was there was what I heard was there were at least nine Senate Republicans who had significant enough problems with the education funding in the budget that they would vote no if that version came to the floor.

That's still not enough, even if every Democrat joined them to vote down the budget.

So there was never any real danger of not passing the budget.

But certainly if Republicans in a supermajority in both chambers and the governor's office had put forward a budget on the floor and nine of their colleagues voted against it in the Republican Party, that wouldn't have looked good.

It would have shown a particularly bright spotlight on what those Senate Republicans had a problem with, which was the level of specifically public education funding in the budget.

So no danger of not passing, but certainly a public perception problem.

Nikki, what needed to happen to bring those folks onboard?

Well, ultimately, the way it worked out is I mean, basically when they come out and they say, here's our budget thing and they say, oh, you know, we're going to increase public K-12 schools by 3% or whatever, those are statewide averages.

And then they do this thing where they they run all the school districts through this complicated formula and other things impact the funding that goes to a district such as their enrollment, the number of honors kids, the number of ESL kids.

And so what happened when they ran that formula is a number of Republicans were shocked that their local districts were receiving, you know, maybe not even 2% increase at a time when inflation is high.

And so the only answer to that is to shove a bunch more money into the formula.

And that's what they did.

They found an additional 312 million to put into the formula in the last day.

That money came from what Senate Republicans had hoped to be an additional $1 billion pay down on the pension obligations.

So it ended up being a $700 million pay down.

They basically, you know, were like, well, if we want more money, we have to find it.

And so that's where they found the money to put into that the school funding formula.

So, Brandon, when you say that was the biggest surprise or unexpected development during during those final days of session?

I would say certainly the last day of session, we just didn't see that coming because it's so rare for for the budget to be held up like that.

I'd say maybe the biggest surprise for me in the final few days of session is that is something that wasn't in the budget, which is extra pension help for for public teacher and law enforcement retirees.

That's nearly 100,000 people who in almost every budget going back three decades have gotten either what's called the 13th check, which is just an extra month of benefits or like we saw in last in the budget passed two years ago, a cost of living adjustment or COLA, which raises the 12 monthly payments you get.

By a certain percentage, it was 1% increase, two years ago.

They didn't include either one of those in the final version of the budget and that's always been kind of a layup in the state budget.

I'm I'm genuinely kind of stunned that they didn't do either one.

And the answer we got was House Republicans wanted to do the 13th check.

Senate Republicans don't.

They want to move away from that system and just do the COLA, the cost of living adjustment from here on out.

But they didn't they they couldn't work out exactly how much a COLA should be.

There's some money already sitting in a fund for retired pension retirees that only would have amounted 0.4% in increase in those in those benefits.

And everybody kind of agreed, well, that's pointless.

But I will just remind people the 13th check would cost about $34 million.

The COLA from last year, which was from the last budget, which was 1%, cost them $50 million last time, theoretically, maybe a little more this time.

And Indiana will end the budget cycle with likely around $3 billion in reserves.

And Nikki, I think one of the things that made this so shocking for people was the fact that the revenue forecast was much stronger than expected.

And so and not too many people anticipated that something that had become so routine would be cut out of the budget.

Yeah.

And I think that and they did, frankly, did not explain it well or at all.

I mean, they had the money.

You know, they've done it for like 28 of the last 32 years.

And at a time when the state has seen its highest inflation, you know, they just shut them out with no real explanation.

Also, I would say part of what drew even more attention to it was on the second to last day, suddenly we realized, oh, they're increasing statewide elected office holders pay by massive amounts with absolutely no discussion.

And that was inserted in the budget on the second to last day of session.

And people you know, when you juxtapose those two things together, it was pretty shocking.

So it'll be interesting to see what the public ultimately, you know, how much how many waves this actually makes.

Probably not much, unfortunately, But I definitely think they are getting a few negative stories out of the budget when they had hoped that there would be more positive outcomes.

I will say, though, that retirees make up a core constituency for lawmakers, Republican lawmakers, especially because those are folks who vote in the largest numbers percentage wise, typically are older, are older Hoosiers.

So, you know, Republican Representative Bob Cherry, who's long been an advocate for the 13 check and was really quite angry that that it wasn't included.

He said, you know, the phones are going to be ringing off the hook and he's putting all the blame on the Senate and Senate Republicans.

Now, how about if you can pair the budget really proposed by the governor to what he actually has on received on his desk to sign?

How much of what he asked for did he get?

Oh, he got almost all of what he wanted.

I would say the biggest thing he didn't get was just about the level of funding.

So he obviously asked for a large investment in public health infrastructure.

And, you know, they only gave him, I guess, about 225 million over the two years they want.

I mean, the original recommendation was about 240 million a year.

He didn't even ask fully for that.

So, I mean, they gave him the the program and they gave him a big amount of money, just not quite the full amount he wanted, although I've heard some supporters even point out.

I mean, as counties are going to have to opt into this, you know, it is going to take a while to ramp that up so he could definitely come back.

Well, not him personally because he's term limited.

But, you know, they could definitely come back and supplement that more after they see how it works in the first year or two.

Brandon, Nikki mentioned that the governor got most of what he asked for, although perhaps not to the level the level of funding he requested.

As we think about that 2023 next level agenda and that huge check list of priorities and economic development, public health, good government education, workforce, community development, going down that checklist, we see almost everything checked off that at least some policy was in place or some program was funded at some level based on his request.

Is that fair to say that he got some of everything but not everything he wanted?

Yeah, I mean, this is a I mean, there's no way to talk about this other than as a wildly successful budget for Eric Holcomb.

You know, a lot of his priorities were shared by every caucus at the state House, Republican and Democrat alike.

So it's not like he was going out on a limb and asking for them for something that they didn't want to give him already.

So that helps, certainly.

But, I mean, I think the thing that stands out to me more than anything else is is, yeah, he got some of what he wanted on on public health funding and some of what he wanted on land conservation and trails.

And but he got everything he wanted and maybe even arguably a little bit more when it comes to economic development and specifically like nearly for around $1,000,000,000 for the Indiana Economic Development Corporation to do this economic development work, whether that's, you know, hundreds of millions for a deal closing fund, more than $100 million for a site selection fund, $500 million for another round of the ready grants, which we saw a couple of years ago and have been very popular around the state between local governments and the private sector.

And even some Republicans, quite honestly, as they were giving the IDC all this money, we're like, okay, that's great.

And then we get what the need is.

But the IDC is a quasi public agency, so it operates without some of the transparency required by law that many other public agencies have to abide by.

And so there's a sense, even among a few Republicans, at least that boy, that's a lot of money with maybe not as much oversight as we might like.

So it'll be interesting to watch over the next two years is a lot of that money is spent where it's going to go, how much we'll know what they're spending it on, and whether Republicans two years from now will be quite as eager to give them quite as much money.

Another go round.

And I just wanted to follow really quickly on one other thing.

Brandon's right, a lot of these are shared priorities.

I do want to note one that I think the governor had to fight for a little more than he thought, which was to eliminate textbook fees for students.

Indiana has lone I mean, not the only state, but only a handful of states charge textbook fees to students or parents for public education.

And so he came out and said, this is a basically a tax on Hoosiers and we need to get rid of it.

And the House agreed sort of they basically just put the cost back on the schools and said, well, we're giving you an increase in funding.

So in the end, he got a direct line item that covers those full costs for students and parents.

And so they will no longer have to pay that approximately $160 million a year in textbook fees.

And I'll add that when the governor first proposed that, it was a bit of a surprise in his agenda.

We weren't expecting that in January when he made that a key a key prong of his final budget agenda.

But immediately we saw legislative leaders kind of be like, yeah, maybe.

And you saw that in the House Republican budget where they were like, well, sure, but schools have to figure it out.

Senate Republicans ended up being as supportive of it as anybody else in their version of the budget.

They separated that out onto a separate line on it like the governor had.

And ultimately in part because, as you already mentioned, Elizabeth, there was a particularly strong revenue forecast a couple of weeks before the end of session that delivered lawmakers about a billion and a half, at least more dollars for the new state budget than they were previously expecting.

I think that definitely helped seal the deal in the final days.

Easier to find or justify to those who are concerned that 160 million.

I notice that one of the things that the education budget focused on was preparing students for life after high school meeting with post-secondary institutions, employers or placement agencies, filling out the FAFSA form for financial aid.

Financial literacy requirement.

At the same time, the other set of education policies seem to be things that the governor really hadn't asked for.

The so called book banning the and working to make sure that teachers are not encouraging or requiring students to take political views that they may not share.

Getting parental permission for any surveys of the students regarding their beliefs and values, and even the requirement for teachers to notify parents within a few days if a student requests different pronouns or a different name, be used in school.

So it's like there are these two very different kinds of bills passed this year with with, you know, some of them getting broad support and others creating more controversy.

Yeah, I mean, I think that's pretty normal that Governor Holcomb has always kind of focused more on mechanics and implementation.

He's never been a real, you know, go for the throat culture war guy.

So he he would make clear throughout session when reporters would ask him about some of these controversial ideas and he would always say, well, that's not part of my budget.

But as of Thursday afternoon at about 3:00, he signed every single one of those bills into law.

So, you know, he obviously didn't have huge problems with them.

He could have vetoed or he could have let them become law without his signature.

But he chose to to accept them.

And really, what you see here is is the bulk of of what lawmakers think is the right thing for the future of Indiana.

In terms of you talked about it, the House really led on this this idea of rethinking or remaking high school.

The Senate didn't quite see it as that much of a transformation.

But it's this idea of we need to do a better job of preparing our high school students for whatever they want to do when they leave high school, whether that's going to a four year college or university, or going to a two year program or getting a certificate or a certification in some workforce need or, you know, and so we in high school getting some of that work based learning so that they are ready to leave high school and immediately join the workforce.

That's the financial literacy is a part of that.

That's for every student, certainly.

But but the idea that if we want them to go and become working members of society, whether that's immediately or after they've gone to university, financial literacy is a really important part of that.

It even plays into whether or not going to a four year college university is the right choice for them because of, you know, the student debt issues that we see in Indiana and across the country.

And then there's the culture wars, because this is a Republican supermajority state.

So whether it's the the Indiana's version of the don't say gay bill, which you referenced about, I will note that it's notification of name pronoun change, which includes like a nickname.

I had a buddy in school.

It was Tony Flando.

His name were Anthony.

If he every every year a teacher would call out Anthony Flando and he'd say, Actually it's Tony that now requires notification within five business days.

So look forward to getting those notices, I suppose in the mail or however they're going to send them to you.

But all this other stuff, it's purely to satisfy a Republican base that has delivered supermajorities to the state House, the different constituencies and different goals there for these different kinds of bills.

What there's also, in addition to the notification, another controversial bill, of course, was the ban on transgender affirming care.

And if you can talk about the final state of that bill.

Yeah, it obviously passed.

It went through pretty smoothly.

I mean, there were definitely some protests against it, but they had a lot of votes.

Governor signed it into law a day after saying the bill was as, quote, clear as mud and then within hours of it being signed into law, the ACLU of Indiana filed suit against it.

So it will be obviously, you know, tied up in court for a bit.

And we'll see what happens there.

I know in other states that have passed these, there often been preliminary injunctions.

And, you know, they are in various levels of litigation there.

So I'm not sure exactly really if it will actually go into effect.

But but we will see pretty soon.

And I got to say, there are I think there are real two two prongs to this for this piece of legislation.

It bans two kinds of gender affirming care.

It bans surgical, gender affirming care for anyone under the age of 18.

Now, if that's all the bill did, it might have gotten unanimous support in the General Assembly because every international and national medical organization says surgical gender affirming care for youth is not recommended.

And it's also not happening in Indiana, despite what some conspiracy theorists claim based on what their ancestor read on Facebook.

In the hours of testimony there were no cases uncovered uncovered in Indiana, were there?

They don't exist, they just do not exist.

Nobody is doing them.

But that's not the only thing the bill did.

The bill also banned medicinal care for transgender youth and and in particular, I think what the lawsuit is getting at and why we've as we've seen in other states, it has some possibility of success in striking the law down is because there are lots of different types of gender affirming care.

For example, you could get a breast augmentation if you are a 16 year old girl in Indiana.

If this law were to take effect, you could get a breast augmentation.

If you are transgender, you cannot.

And that's really at the crux of the lawsuit.

It didn't ban gender affirming care.

It only banned gender affirming care for transgender youth because that's the population that Republicans nationally have decided they're able to target as a way to, again, drive up support among their base.

Yeah, I mean, they didn't say, you know, puberty blockers are bad.

You can still get a puberty blocker if you have a medical reason, as long as the medical reason is not your transgender.

And as Brandon said, it doesn't ban plastic surgery for, you know, youth with their parental permission, obviously, as is required.

But so focusing a ban on why someone is getting a treatment, I think is definitely the key behind that lawsuit instead of, you know, the treatment itself, either the treatment itself is dangerous and inappropriate or, you know, or it's not.

And I think that's what that lawsuit's going to come down to about this idea of parents rights.

We're hearing a lot about parents rights from legislators when it came to things like proposed parental oversight of curriculum, parental oversight of books in the library.

But here we seem to have a little bit of a different case where it is not up to parents to decide how to treat children in these cases.

But there's an insistence that the state should step in.

Parental rights is a convenient talking point, like so many others at the state House.

For whatever you want to use it and then ignored when you don't.

So in the case of the two bills we just talked about, parental notification.

If your child wants to change their name, that is very important for parental rights to know what's going on at their child's school, with their child, at their school.

But we're going to completely ignore what parents want for their kids when it comes to transgender youth.

On the other hand, there was a bill about providing handgun training for teachers.

I think a worthwhile piece of legislation, if we're going to have guns in schools, we would like the people carrying them to be trained to use them.

I think that's terrific and providing funding for that effort.

But there was a provision proposed to that bill by Democrats to say, hey, if the teacher decides to carry a gun in school, which is currently legal in Indiana, with the support of I believe the local school board has to approve that.

But that's currently legal.

If the teacher decides to carry in the classroom, let's just notify the parents that, hey, there's going to be a gun in class.

No Republicans said no to that.

So again, parental rights is just a convenient talking point for when you want to support something and ignored when you don't have a final in the final minute that we have.

Is there anything that didn't pass that you're surprised about and that you think will come up next session?

I do think there was a lot of push this year and the year before about moving school board races to be partisan.

It ultimately did not make it through.

But I don't I don't see supporters backing down on that one.

And I think it's only a matter of time before we see some votes on that one.

So that is the one that immediately comes to mind for me and would this allow communities to decide partisan or non partisan.

I mean, there have been different versions of the bill.

Some of them just would have made them partizan statewide.

There was a version of the bill this year that would have basically have held referendums on in each community about whether it should be partisan or not.

So, you know, it just depends which version makes it through.

But I feel like that conversation is not over.

And another example of a convenient talking point that's ignored when it's convenient, which is we're not a referendum state on things like abortion or marijuana possession, but we would be on the partisan school boards issue.

Yeah, interesting indeed.

And to be continued because that's all the time we have for this episode of Politically Speaking.

I want to thank reporters Brandon Smith of Indiana Public Broadcasting and Nikki Kelly of the Indiana Capital Chronicle for sharing their insights with us today.

I'm Elizabeth Bennion, reminding you that it takes all of us to make democracy work.

We'll see you next time.

This WNIT local production has been made possible in part by viewers like you.

Thank you.