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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowAs the first half of the Indiana legislative session winds down, a bill that would add new constraints to regional economic development funding remains up in the air.
Senate Bill 377 would introduce a new framework for future regional funding initiatives, bill author Sen. Greg Goode, R-Terre Haute, told IBJ. Those initiatives, like the Holcomb administration’s Regional Economic Acceleration and Development Initiative, or READI, have previously channeled hundreds of millions of state dollars into communities around the state to jumpstart projects to improve quality of place and the state’s economy.
However, during the bill’s first committee hearing Jan. 23, lawmakers and business leaders critiqued some requirements of the bill and worried it might affect funding rounds already in progress.
If the legislation doesn’t make it through committee this week, Goode told IBJ key pieces of the bill could wind up in the budget or other economic development legislation. The House and Senate have until Feb. 20 to pass legislation for the other chamber’s consideration.
The bill has yet to be scheduled for a vote in the Senate Appropriations Committee after an initial hearing Jan. 23. Chair Sen. Ryan Mishler, R-Mishawaka, said then that the committee may circle back with an amendment. It is currently not on the committee’s meeting agenda for Thursday.
“There are some changes that need to be made for this bill,” Mishler said in January. “I think we have a direction of where this bill needs to go.”
The legislation would impact programs like READI and the Pence administration’s Regional Cities Initiative. It’s unclear whether Gov. Mike Braun will champion a similar initiative in the future, and he did not include such funding in his budget proposal.
However, Goode said he is advocating for funding this budget cycle. He said the amount of investment committed by the federal government and the private sector necessitates the state contribute at a similar clip.
Recent READI funding rounds have included quality-of-life and -place projects as a means to attract companies and workers to the state. Projects include everything from new community centers and parks to an Ivy Tech training lab and broadband extension support.
The bill cuts from place-aligned projects and hones in on industry-focused development. Goode said he wants this type of funding to be focused on job creation, and in time, other aspects like housing and health care outcomes will improve.
“While I’ve been deeply grateful for the Regional Cities Initiative and then READI 1.0 and 2.0, I believe that we still are missing the mark to some extent,” he said, “by way of aligning dollars appropriated for economic development activities with some of the strongest sectors where Indiana is a leader.”
SB 377 coins the term “endless frontier” to describe seven priority industries: health life sciences, emerging biotechnology, microelectronics, quantum physics, artificial intelligence, cybersecurity and defense development. Projects seeking future funding would be required to be related to those industries, according to the bill, and the legislation builds a set of vetting parameters.
David Bottorf, executive director of the Association of Indiana Counties, told IBJ he believes Goode’s motivation is well-intended and said improving regional cooperation and investment is critical.
“I think he was trying to put a bill out that would be at least maybe a working vehicle to see where the new administration is going to go with their regional economic development efforts,” he said.
Testimony during the Jan. 23 hearing highlighted potential changes to be made.
A few lawmakers were uneasy, expressing concerns that the current language could affect READI 2.0. Goode told IBJ the changes would only affect future funding. Mishler said during the Jan. 23 meeting that, though the bill did not intend to touch that funding, others were interpreting the bill differently.
The Indianapolis Chamber of Commerce was neutral on the bill and mirrored a concern of Sen. Liz Brown, R-Fort Wayne, over whether the list of applicable industries was too tight.
A host of business leaders—including the Cook Group, Purdue University and Tom Dakich, CEO of Quantum Corridor— showed support.
Editor’s note: A previous version of this story said READI 2.0 funding decisions would be announced in April. That round of funding was announced last April.
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READI and place-based investments was one of the few good tools we had to actually deliver meaningful improvements to communities at the State-level. Now it sounds like it’s going to be another arm of the State to give away tax dollars to profitable corporations.