Pence submits lean budget built around tax cut

Published on NewsOK Modified: January 15, 2013 at 8:52 pm •  Published: January 15, 2013
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Now the General Assembly will take its turn at the budget, and leaders in the Republican-dominated Legislature have indicated their priorities could be far different from the new governor's.

House Speaker Brian Bosma, R-Indianapolis, cast doubt on the proposed tax cut throughout the end of last year and other leaders, including Senate President Pro Tem David Long, R-Fort Wayne, have said a final answer may have to wait until after the state sees new economic forecasts in April.

"We're going to have a good discussion the next four months," said Senate Appropriations Chairman Luke Kenley, R-Noblesville. "There's a couple of things we don't know yet, (like) how we're going to deal with this Medicaid issue, and it kind of dwarfs everything else if we can't get a good answer to that."

Indiana's Medicaid actuary, Milliman Inc., has estimated the state will have to pay an additional $600 million over the next seven years to cover the cost of uninsured residents who qualify for Medicaid. The jump in enrollment, the firm says, has nothing to do with any change in Medicaid, but instead is due to an assumed "woodwork effect" in which low-income residents who qualify for Medicaid but are not enrolled seek federal coverage as the individual mandate takes effect next year.

Lawmakers will also be eyeing new funding for transportation, as the money from the 75-year lease of the Indiana Toll Road dries up, and could ditch the tax cut in favor of more spending on K-12 education and higher education. They also will ponder expanding the state's Medicaid program under the federal health care law, something Pence did not include in his plan.