The Week in Federal Affairs

  • Obama regulation on coal industry is rolled back! On Thursday, President Trump repealed the Department of the Interior’s Stream Protection Rule. The Indiana Chamber previously had signed on to a letter in support of this action. The letter stated that the Stream Protection Rule “is a one-size-fits-all federal mandate that interferes with the longstanding federal-state balance in overseeing mining operations. It will place massive amounts of coal reserves – and the affordable energy they provide – off limits.” Congressman Larry Bucshon (IN-08) also issued a statement at this welcome news.
  • On Thursday, Senators Joe Donnelly and Todd Young introduced fellow Hoosier Seema Verma to the Senate Finance Committee immediately before the hearing on her experience to become administrator of the Centers for Medicare & Medicaid Services.
  • Young met with the chief of naval operations, Admiral John Richardson, to discuss the Naval Surface Warfare Center (NSWC) Crane and its critical support for our warfighters and national defense. During the meeting, Young urged Admiral Richardson to ensure that NSWC Crane is exempt from the hiring freeze so that it can continue its important work. Young’s meeting this week with Admiral Richardson follows his letter to Secretary of Defense Mattis on January 27.
  • Previously, Sen. Joe Donnelly met with Acting Secretary of the Army Robert Speer on the same subject.
  • Young was also among a group of legislators that met last Friday in Washington D.C. with Japanese Prime Minister Shinzo Abe. Young says the gathering involved a lot of discussion on global security and trade agreements, but his time with the prime minister was focused on economic issues. Read the Inside Indiana Business story, which also includes audio from Young.
  • Congressman Todd Rokita (IN-04) on Thursday re-introduced an important piece of legislation to protect the rights of workers. The Rewarding Achievement and Incentivizing Successful Employees (RAISE) Act amends the National Labor Relations Act to allow employers to give merit-based bonuses, raises or other increases to an individual employee above the level set by the employee’s union contract. Per Rokita, a union contract should not be the ceiling on how much a good employee can earn and the RAISE Act would provide every worker with a chance to earn a bonus.
  • On Wednesday, the CEO of Aetna, one of the nation’s largest insurers echoed growing concerns that the Affordable Care Act is in a death spiral. According to a Politico report, Aetna’s CEO argued that, “More insurers will pull out of the government-run marketplaces in the coming weeks and many areas will have no insurers to provide Affordable Care Act coverage in 2018.” He went on to say, “It’s not going to get any better; it’s getting worse.”
  • On a related note, Rep. Bucshon recently introduced legislation to help stabilize the insurance markets by giving states the flexibility to meet the needs of their unique patient populations.
  • Congresswoman Susan Brooks (IN-05) introduced a measure this week to help veterans get the most from the GI Bill.
  • A honor for Rep. Pete Visclosky (IN-01): He recently received the U.S. Army’s Distinguished Civilian Service Award from Acting Secretary of the Army Robert Speer.

Around the Horn With What Happened in D.C. Last Week

As expected, President Trump signed many executive orders this past week aligning with campaign promises for sweeping change. Some of these include:

  • Encouraging federal agencies to dismantle large parts of the Affordable Care Act, including the very controversial individual mandate requiring people to purchase insurance
  • The official withdrawal of the U.S. from the Trans-Pacific Partnership – a move the Indiana Chamber opposes
  • Freezing federal hiring
  • Advancement of the Keystone XL and Dakota Access oil pipelines
  • Illegal immigration activities – directing dollars to begin construction of a wall on the southern border and the boosting of federal agency efforts to stop illegal immigration
    On a related note, the President’s chief of staff, Reince Priebus, issued a memo telling federal agencies to put a freeze on any new regulations and a 60-day hold on regulations that have not yet taken effect.

The members of the President’s cabinet that have been sworn in to date by Vice President Mike Pence: retired Marine General James Mattis as Defense Secretary, retired Marine General John Kelly as Secretary of Homeland Security, Rep. Mike Pompeo (R-Kansas) as Director of the CIA and Governor Nikki Haley (R-SC) as UN Ambassador.

Rex Tillerson’s nomination for Secretary of State made it out of the Senate Foreign Relations Committee and is awaiting consideration by the full Senate. Meanwhile, Betsy DeVos, nominee for Education Secretary, had her committee vote postponed until January 31. Indiana’s senior senator, Joe Donnelly, has announced that he will not support her nomination; watch his announcement of that decision.

Indiana Chamber Opposes Teacher Evaluations Bill

The Indiana Chamber opposes SB 35, which provides that a school corporation may use objective measures of student achievement as part of a teacher evaluation plan. (Current law provides that the use of an objective measure of student achievement is required as part of a teacher evaluation plan.)

While there are potentially some issues with teacher evaluations and those issues should be addressed at a more comprehensive level, it is a longstanding Chamber policy that teacher evaluations are extremely important and that student objective measures should be included in the evaluation process.

Note that last year, HEA 1395 (which did decouple the test results from the evaluations for one year) passed with the Chamber’s qualified support. This is because we felt that the administration of the ISTEP test – not the exam itself – was flawed. There is already local control when determining how much student objective measures will be attributed toward teacher evaluations and what objectives should be included in addition to the statewide assessment.

In addition, while many complain about including student objective measures in evaluations, it does not seem to have a negative impact in effectiveness ratings for teachers (98% were rated effective or highly effective in the most recent evaluations).

The bill was heard in the Senate Education Committee last Wednesday and held until this week for amendment and vote.

Concerns Over Education Matters Bill

The Indiana Chamber opposes, in part, SB 108, which eliminates the requirement that the Department of Education must publish a model compensation plan. It also:

  • Eliminates a requirement that each school corporation shall submit its local compensation plan to the department
  • Eliminates a requirement that the department must publish the local compensation plans on the department’s web site
  • Removes requirements that the: (1) department shall report any noncompliance of a school that fails to submit its compensation plan; and (2) State Board of Education shall take appropriate action to ensure compliance
  • Makes changes to the time frame, from four to six years, in which the State Board may take over a failing school
  • Provides that a principal or superintendent, or the principal’s or superintendent’s designee, may recommend an individual to participate in the Indiana high school equivalency diploma program

The Indiana Chamber testified against the provision concerning failing school interventions. We feel strongly that the trigger threshold of State Board of Education intervention should be kept at the current rate of four years instead of the drafted language of six years. It is important to keep our schools strong and accountable for our students, and six years is simply waiting too long to act regarding an underperforming school; our students deserve better.

The bill was heard in the Senate Education Committee last Wednesday and held until this week for amendment and vote.

Around the Horn on Federal Legislative Issues

As part of the Indiana Chamber’s robust federal advocacy program, Caryl Auslander will be working with the Indiana delegation (both in Washington, D.C. and here in Indiana) throughout the year. Look for additional stories and coverage of our federal efforts on your behalf in these reports and through other communications.

Below are some of the top recent Indiana news items:

  • Congressman Trey Hollingsworth spoke on the House floor in support of the REINS Act during his first week on the job; the measure to curb unnecessary government regulation passed the House on Wednesday. Hollingsworth has also been placed on the House Financial Services Committee.
  • A Hoosier connection remains on the House Ways and Means Committee with Rep. Jackie Walorski (IN 2) receiving a nod; Sen. Todd Young was most recently on this important committee.
  • Chairman alert: Rep. Susan Brooks (IN 5) has officially taken the helm of the House Ethics Committee.
  • This week, freshman Rep. Jim Banks (IN 3) presided over the House floor debate of a statement of opposition to the recent U.N. Resolution on Israel; the measure passed the House easily.
  • Newly sworn-in Sen. Young was assigned to four important Senate committees: Foreign Relations; Health, Education, Labor and Pensions; Commerce, Science and Transportation; and Small Business and Entrepreneurship.
  • Retirement is on hold for former Sen. Dan Coats, who was announced as President-elect Donald Trump’s pick for Director of National Intelligence.
  • Indiana’s now senior Sen. Joe Donnelly was awarded the Department of Defense Medal for Distinguished Public Service; Donnelly is a member of the Senate Armed Services Committee.
  • Senators Donnelly and Young were successful in getting the Government Publishing Office to formally designate Indiana residents as “Hoosiers” (bye-bye “Indianans”) and celebrated with this video announcement.
  • South Bend Mayor Pete Buttigieg threw his hat into the ring for chairman of the Democratic National Committee.

Latest on ISTEP and ‘A-F’ School Grades

The ISTEP Alternatives Panel has made its final recommendations on how to replace ISTEP, which was legislatively determined to sunset in the fall of 2017 after scoring, technical and mismanagement issues plagued the exam the past two years.

These recommendations include: students in grades 3-8 to take one English and math exam at the end of the school year, and 10th grade students to take English, Algebra 1 and biology at the end of the school year. The tests will be taken once and not split into two testing times in the winter and spring.

One of the most important recommendations was to recognize that national testing experts advised that it takes a minimum of two years to fully implement a new testing system throughout the state. So it is very likely that we will see legislation during the upcoming 2017 legislative session to undo the sunset provision.

The recommendations received wide support from 21 of the 23 members of the panel, made up by a majority of educators. The two “no” votes were by Superintendent of Public Instruction Glenda Ritz and Ayanna Wilson Coles, a Pike Township educator appointed by Ritz. These recommendations now go to the Legislature, which can choose to use them during the 2017 legislative session. The Indiana Chamber strongly advocated last year
to have a business representative appointed to the panel, and we would like to thank our board member, Marilyn Moran-Townsend of Fort Wayne, for all of her work and dedication to the panel and helping lead the collaborative effort that resulted in the recommendations.

This week, the State Board of Education released school A-F grades which, as anticipated, were lower than in previous years. And while expected, it is important to note that it is very difficult to compare this year’s scores to the scores in 2015 for two important reasons. First, last year, the Legislature (with the Indiana Chamber’s support) decided to protect schools from the lower ISTEP scores due to the test mismanagement and scoring
issues. This “hold harmless” provision stated that 2015 grades were changed only if they improved from 2014; otherwise schools were able to hold onto the higher grade. So the 2016 scores released this week are the actual first show of true impact of the more rigorous assessment based on the newer and more-challenging college and career ready standards. Second, this year the State Board of Education determined school grades
based on a new formula that equally weighs growth and proficiency.

While there has already been significant discussion on whether to “hold-harmless” for this year’s ISTEP exam, the U.S. Department of Education has already stated that such a provision would not be allowed. The Indiana Chamber will continue to push legislators on the importance of assessments AND accountability – for teachers, schools and students in the 2017 legislative session and beyond.

Important New Teacher Scholarship Now Available

A program the Indiana Chamber advocated for to assist with the potential teacher shortages is now accepting applications.

The Next Generation Hoosier Educators Scholarship allows the Commission for Higher Education to award college scholarships for up to 200 of the best and brightest future teachers. These students must have graduated in the top 20% of their class and receive the top 20th percentile scores on the SAT/ACT exams.

To continue earning the scholarship in college, students must earn a 3.0 cumulative GPA and complete at least 30 credit hours per year. Current college students are also eligible for the scholarship, but priority will be given to high school students.

Upon graduation, scholarship recipients have the requirement to teach in Indiana for five consecutive years.

The Pence administration set up the program in House Bill 1002 and the Legislature appropriated $10 million in House Bill 1001, authored by House Speaker Brian Bosma.

The Indiana Chamber believes that this legislation is a great first step in recruiting outstanding teachers into the field as well as helping to raise the profession. Excellent teachers lead to strong students, which will eventually lead to talented employees and business leaders.

Visit www.LearnMoreIndiana.org/NextTeacher for more information on the Next Generation Hoosier Educators Scholarship and to apply.

The Commission for Higher Education will review applications and notify students selected to receive a scholarship by April 15, 2017.

Chamber Talks Policy at D.C. Fly-in

congressWe are fresh from our return from the Chamber’s D.C. fly-in last week. The group had a policy briefing, dinner with the Indiana delegation and successful meetings on Capitol Hill the following day.

To kick things off, the Chamber’s policy briefing covered trade, transportation funding and tax reform.

U.S. Assistant Trade Representative Ashley Jones of the White House Office of Trade briefed our group on the Trans-Pacific Partnership (TPP). Per the Chamber’s federal position on the matter, we support the establishment of free trade agreements that create free and fair trade for the U.S. – including TPP. We support free trade initiatives because international trade touches all Indiana businesses – large and small – at some level. With Indiana being ranked in the top tiers in manufacturing, life sciences, agriculture, etc., trade is imperative to Hoosier businesses. Selling more manufactured Indiana goods and services around the world is a great way to create, maintain and grow Indiana jobs, help the business community and keep Indiana and the United States ahead of global competitors.

We know and understand that our entire membership is not 100% on board with TPP – and neither are the two major party presidential candidates or some in the Indiana delegation – but we are hopeful that some negotiations will allow for TPP to receive a congressional vote after the November election.

Dennis Faulkenburg, president of APPIAN (a transportation consulting and governmental affairs firm in Indianapolis) and chairman of the Chamber’s Infrastructure Committee, spoke to the group on transportation funding. He explained that it was important to thank the delegation for their support of the federal FAST Act (Fixing America’s Surface Transportation), which passed last December. However, while the FAST Act provides funding through 2020, Congress did not enact a stable, long-term way to pay for highway infrastructure, instead transferring $70 billion from the General Fund to pay for the bill. As the Chamber has advocated before at the state level, it is imperative to have long-term sustainable funding for Indiana infrastructure. It is our hope that the next Congress will make this a priority.

Chamber President Kevin Brinegar gave the group an update on reforming the federal tax code. Kevin reminded everyone that a major overhaul is long overdue – as it has been nearly 30 years since the last major reform. Since that time, the code has been loaded up with hundreds – if not thousands – of new provisions. Overall, the current code is overly complex, unfair, anti-competitive and stifles both economic growth and job creation. Such a reform should include a lowering of the corporate tax rate from 35% (the highest in the world today) to 25% or lower; a lowering of the top personal income tax rate to 25% while reducing the number of brackets; elimination of the alternative minimum tax (AMT) and estate tax; and adoption of a territorial system in which income earned overseas is not taxed twice. Kevin stressed the importance of letting our delegation know that we need to curb federal spending.

The group then enjoyed a dinner while meeting with and hearing from both Sen. Dan Coats and Sen. Joe Donnelly as well as most of our House members. Many spoke about the policies we highlighted earlier in the evening and about the 2016 election year and how historic it has become.

Thursday morning’s political briefing featured Jeff Brantley and Rob Engstrom, political experts from the Indiana Chamber and U.S. Chamber respectively. Both felt that in Indiana Republicans will likely keep their super majorities in the House and Senate. At the national level, Engstrom spoke about polling in the U.S. Senate race and in the 9th Congressional District and how he sees the momentum swinging to the Republicans, albeit noting still a tough road ahead.

The group then moved to meetings on Capitol Hill with the entire delegation or their staff representatives.

A special thank you to this year’s D.C. fly-in sponsors:

  • Zimmer Biomet – dinner sponsor
  • Allegion – breakfast sponsor
  • Build Indiana Council – hospitality sponsor
  • The Boeing Company, Duke Energy, Hartman Global IP Law, the Kroger Company, Old National Bank and Wabash Valley Power – event sponsors

“Zimmer Biomet is proud to be a longtime member of the Indiana Chamber and we were pleased to be a sponsor of this event, as we have been since 2012. … The event was an excellent opportunity for Zimmer Biomet and other Indiana businesses to tell our representatives and senators directly what we need to succeed.” – Stuart Kleopfer, Zimmer Biomet President, Americas

A Look at Pre-K Expansion and New Coalition

GIt is now late summer, and that means that we’ve reached back-to-school time in Indiana. It is a big year in the Auslander household as my youngest embarks on her first year of pre-K. However, there are thousands of less-fortunate Hoosier 4-year olds that will not have that opportunity to join her.

The Indiana Chamber has been supportive of pre-K in our legislative priorities for years and was a champion in promoting the passage of the state-funded pilot program “On My Way Pre-K” in five counties (Allen, Lake, Marion, Jackson and Vanderburgh), as the business community strongly believes that children who receive a quality start to their education will succeed better and need less remediation moving forward in their schooling.

There have been many recent announcements on pre-K during this busy campaign season. The Chamber has chosen to endorse and help lead the efforts with the All IN 4 Pre-K initiative recently rolled out across the state.

This plan focuses on several key non-negotiable points:

  • Expansion of the pilot program to include more Hoosier children from low-income families
  • Pre-K programs included must be of high-quality – level 3 or 4 of Paths to Quality (Family and Social Services Administration quality rankings)
  • Pre-K programs should include a mixed-delivery system of providers: centers, schools (public and private), ministries and family homes
  • Work with the Legislature to find an appropriate budget amount to fund the expansion, within the constraints of the budget and revenue forecasts
  • Continue reporting requirements put into place with the existing pilot program
    According to the Indiana Department of Education, our state spends nearly $32 million a year on kindergarten remediation. The expansion of a state-funded pre-K program could significantly mitigate those costs.

My daughter will succeed in her schooling because my husband and I can afford to send her to a quality program. Other Hoosier students are not nearly as fortunate. The Indiana Chamber is ready to once again make this a priority for the upcoming legislative session.

Sen. Donnelly’s Visit Highlights an Active Month for Our Congressional Affairs Committee

donnellyWhile the presidential election may be the talk of D.C. and the media, this is also a busy time of the year for federal policy conversations for the Indiana Chamber.

In mid-August alone, Sen. Joe Donnelly, Senate candidate Evan Bayh and state Sen. Jim Banks, the Republican candidate for congressional District 3, met with our congressional affairs committee members to discuss issues important to Indiana. And Congresswoman Susan Brooks (District 5) was the keynote speaker for our Indiana Conference on Energy Management, advocating for the need for both sustainable and affordable energy.

While we may never agree on all matters with our congressional members, their overall willingness to engage, listen and act – by and large – in the best interest of the Hoosier business community and residents is a longstanding hallmark of Indiana’s delegation. And we are very appreciative for that.

Donnelly, who is not up for re-election, shared his thoughts on a variety of issues during his nearly hour-long visit. For one, he contends the gridlock in Congress is overblown: “What you see on TV bears no reflection to what is reality.” He stressed that 80% of the time the group works together, but the 20% – which often features high profile issues – is what drives the media reports. And “time after time, the Indiana delegation works together.”

Whether that’s Brooks with Donnelly on the law to combat opioid abuse, signed by the President last month, or Indiana’s senior senator, Dan Coats, and Donnelly – joined by District 9 Congressman and Senate candidate Todd Young – leading the charge to suspend the medical device tax for two years. And these are just two of the many examples.

Incidentally, these are among the efforts that led to Donnelly being presented with the U.S. Chamber’s “Spirit of Enterprise” award at our office last week; the honor is for his continued commitment to job creation and economic growth.