Training: Turn Up the Heat in August

Business direction background with two people

Summer will be in full swing with a multitude of training opportunities to enhance employees’ expertise and protect your bottom line this August.

First up is the 2016 Indiana Tax Conference, one of the state’s largest, on August 11. Learn the latest in tax case law and legislation as highly-experienced speakers identify ways to help you stay in compliance and reduce tax liability.

Francina Dlouhy, partner at Faegre Baker Daniels, will share her perspective on a crucial issue during her keynote luncheon presentation – It Was a Bad Idea Then and It Still Is Now! What Combined Filing Would Mean for Indiana. Among other themes are multistate tax hot topics for 2016, Affordable Care Act reporting compliance and an Indiana Department of Revenue update.

BKD, LLP is the presenting sponsor. Gold sponsors are MCM CPAs & Advisors and McGuire Sponsel. The silver sponsor is DMA – DuCharme, McMillen & Associates, Inc.

Fuel business savings the following week by attending the 14th Annual Indiana Conference on Energy Management on August 17-18. Learn how to cut costs and maximize resources as energy experts from throughout the state share practical – and effective – compliance strategies.

Don’t miss engaging keynote presentations:

  • Congresswoman Susan Brooks (invited) – opening general session: August 17
  • Canadian Consul General Doug George – Energy Security and Supplies: the Canada-U.S. Relationship – general session: August 18
  • Kyle Rogers, The American Gas Association, and The Edison Electric Institute representative (invited) – Outlook on Natural Gas and Electric – closing luncheon: August 18

Additional highlights include panel discussions, customized training (choose from a variety of options) and an expo showcasing the products and services offered by businesses in your field. Explore topics such as distributed generation; reducing utility bills; using the government and tax code for energy efficiency; and energy bankruptcies.

The 14th Annual Conference on Energy Management will take place at the Crowne Plaza Indianapolis-Downtown Union Station. Register online or call (800) 824-6885.

Gold sponsors: EDF Energy Services; Ice Miller LLP; MacAllister Power Systems; and Vectren. Silver sponsors: Cummins, Geronimo Energy, Indiana Electric Cooperatives, NIPSCO and Telamon Corporation.

Rounding out August offerings are:

Sponsorships are available by contacting Jim Wagner at (317) 264-6876.

Let’s Caucus: Candy, Cut Flowers and Concrete

caucus

What do these three items have in common? No, it’s not a Valentine’s Day gone bad for a mobster (though possible). All three subjects actually have congressional caucuses in their honor, during which legislators explore ways to promote their industries on Capitol Hill.

The newest entrant is the Congressional Candy Caucus – announced June 16 – which highlights “the economic impact, responsibility commitments and community involvement” of the candy manufacturing industry. One of its founders, Rep. Jackie Walorski (Indiana’s 2nd District) says: “Candy manufacturers like the South Bend Chocolate Company in my district have a long and lasting tradition of not only making Americans’ favorite treats but creating good jobs and growing our economy.”

No doubt that’s true, but I’m guessing there will also be some chocolate indulgence when the caucus members meet.

There are literally HUNDREDS of these congressional groups. Some lofty; others more frivolous – at least on the surface.

The July-August issue of BizVoice magazine examines caucuses that may leave you scratching your head or simply wanting to know more about what they really promote.

Seeking Government Answers

If you are not receiving timely responses from written queries to the federal government, join the crowd. Washington is not known for being nimble, but agencies respond differently according to the Center for Effective Government. Here’s a brief breakdown:

  • Especially slow: Department of Veterans Affairs, State Department, Securities and Exchange Commission, Environmental Protection Agency and Occupational Safety and Health Administration
  • High marks: Agriculture Department and Social Security Administration
    Congress will try to move the biggest offenders, but Kiplinger reminds that “the bureaucracy, after all, is still the bureaucracy. Making agencies more responsive is sure to take time.”

Future Road Funding: Smooth or Bumpy?

36601064This summer, as we wander Indiana for work or pleasure, motorists experience both how good and bad Indiana’s road infrastructure is. The real issue is Indiana’s road funding mechanisms are in need of modernization to keep up with today’s demands.

To address the issue short and long term, several months ago the Legislature passed and the Governor signed two important bills on road funding, HB 1001 and SB 67. Combined, the bills did the following:

  • Provided a total of $689 million of additional funding over the next four years to Indiana’s local governments for their road funding needs.
  • Provided an additional $228 for state road funding in 2017. (Funding for this and the above came from a combination of using some of Indiana’s budget surplus, providing revenue from local option income tax collections and directing some of the sales taxes collected on fuel to road funding.)
  • Provided Indiana counties the option to double their wheel tax and for municipalities with a population over 10,000 to establish a wheel tax. If eligible local governments choose to do this, they can raise up to an additional $376 million a year.
  • Established the FIRSST (Funding Indiana’s Roads for a Stronger and Safer Tomorrow) Task Force to develop a long-term plan for state and local roads and bridges, and develop funding mechanisms for the various components of the plan.

The FIRSST Task Force has a lot of work to do before the end of this year. The goal is to present a plan that will set the stage for what might take place during the 2017 legislative session. Its 16 members will verify the costs of road maintenance needs, look at current revenue streams and determine what current and new ideas are viable for the future. This is important given that the primary funding mechanism, the 18-cent-per-gallon gas tax, is not keeping up with the cost to maintain state and local roads, let alone build new ones.

In a recent Chamber infrastructure policy committee meeting, Senators Luke Kenley (R-Noblesville) and Brandt Hershman (R-Buck Creek) indicated their commitment to achieving a solid and sustainable long-term solution during the 2017 session. Given the Indiana Chamber’s Indiana Vision 2025 goal area of “Superior Infrastructure”, we will play an active role in this discussion.

Tax Court Under Scrutiny

10044552In April 2015, the Indiana Supreme Court ordered the creation of the Ad Hoc Tax Court Advisory Task Force to review the Indiana Tax Court’s resources, caseload, performance and operations. In May of 2015, the General Assembly passed legislation calling for the Indiana Judicial Center to conduct a like review and submit a report to the Legislative Council by December 1, 2016. The Supreme Court subsequently amended its order to have the task force submit its report to the Judicial Center and the Legislative Council by May 1, 2016.

In April 2016, the task force issued its findings and recommendations along with a report compiled by the National Center for State Courts (NCSC), which was contracted to assist the task force. These materials are now getting some attention and are definitely worthy of examination. The nine-member task force was chaired by Court of Appeals Judge James S. Kirsch. The members include a variety of experienced tax practitioners as well as the general counsel for the Department of Revenue and chief deputy for the Office of Attorney General. Tax Court Judge Martha B. Wentworth also participated as an “ex officio” liaison and attended meetings by invitation from the chair.

The NCSC researched the Court’s caseload, staffing and timeliness. It also interviewed stakeholders and conducted a survey seeking opinions on these subjects and on the perceived timeliness, fairness and demeanor of the Court. And it looked into case management, internal procedures and administrative practices. The statistical results, observations and recommendations are all set out in the report. The survey results evidence a contrast in opinions between the government responses and taxpayer responses regarding the quality of service provided by the Tax Court.

In short, it seems that the government representatives are significantly less satisfied with the Court. Not unrelated to their disgruntlement, it was noted in the preface to the findings that the Department of Revenue and attorney general members of the task force sought recommendations to review the very structure of the Court, recommending review of the de novo hearing process and the lack of automatic appeal rights. However, the majority of the group and the chair found these matters “outside the purview of the task force’s directive.”

Several things were apparently deliberated and no specific findings or recommendations were made. Ultimately, the task force’s primary finding was that after 30 years, the existence of the Tax Court still serves its initial purposes of providing tax expertise, tax law consistency and renders fair and thoughtful opinions.

The findings do focus on the need for continued progress in timely addressing pending cases and the utilization of resources and staff. The report recommends an ongoing review and suggests the Tax Court explore several reforms to its case management practices, including ruling on some matters without oral arguments, limiting discovery, requiring the Department of Revenue to certify a complete audit file (to avoid it having to be reconstructed) and referring some cases to mediation.

The findings and recommendations, NCSC report and other materials are available online.

Immigration Committee Hears from Business

?????????????????????????????????????????????????????????????The Indiana Senate Select Committee on Immigration Issues conducted its third meeting recently; this time it was the business community which brought its case before Senate legislators. The Indiana Chamber made a very effective plea for Congress and the federal government to bring about comprehensive immigration reform.

At the Chamber’s request, subject experts Jon Baselice, Chris Schrader and Jenifer Brown testified – along with Chamber staff – on the impacts of immigration on companies.

Baselici is the director of immigration policy for the U.S. Chamber of Commerce, served on the staff of U.S. Sen. Marco Rubio (R-Florida) and assisted in drafting S.744, the comprehensive immigration reform bill that passed the Senate. He testified that our immigration system is working abysmally. The U.S. Chamber sees four areas for reform on immigration:

  1. Controlling our borders and preventing individuals from overstaying their visas
  2. Modernization of our legal immigration system, placing more value on a potential immigrant’s skills and talents, along with temporary worker programs
  3. An enhanced employment verification system as long as there is a preemption of state and local E-verify laws, adequate safe harbors for employers who use the system and the creation of an agricultural guest worker program that provides agribusinesses meaningful access to lawful workers in times of need
  4. What to do with the current undocumented population of 11.3 million.

Chris Schrader, president of the Society for Human Resource Management, presented a perspective on E-verify. He discussed its limitations, that there was no safe harbor for employers and that it is unable to authenticate identity. Jenifer Brown of Ice Miller testified on the actions available to Indiana under federal law (including the Immigration Reform and Control Act); the pros and cons of the federal E-verify system – explaining the complexities of the mandatory versus the non-mandatory system; the effect of unauthorized aliens upon the economic well-being of Indiana and the effect of their removal and changes in federal law or policy regarding legal immigration that could improve the Indiana economy. The Chamber also provided a presentation on the difficulties and the process of the I-9 employment eligibility verification form.

Among others testifying before the committee: the Indy Chamber of Commerce, Indiana Farm Bureau, Indiana State Building & Construction Trades Council, Indiana Builders Association and Indiana Restaurant & Lodging Association. Three more meetings are expected before a report is prepared for the Indiana Senate.

Early Childhood Education Gets a Push in the Right Direction

NtJDO

Great news: It seems like 2017 will be the year that everyone finally jumps on the train to expand the pre-K pilot program in Indiana. In just the past two weeks, we have had two major announcements from Governor Mike Pence and Superintendent Glenda Ritz on different proposals to expand the pre-K pilot program.

As background, in 2014 Pence testified in front of the Senate Education and Career Development Committee to pursue Indiana’s first pre-kindergarten program for disadvantaged four-year-olds. That session generated legislation to create a five-county pilot program (selected counties were Lake, Marion, Jackson, Vanderburgh and Allen) for 2,300 grants of up to $6,600 for low-income four-year-old students. This voluntary, voucher-based program could place students in public schools, private schools, licensed child care centers, licensed homes or registered ministries – as long as they were a Level 3 or Level 4 on Paths to Quality, which is Indiana’s child care quality rating and improvement system.

This pilot program was awarded $10 million that year and was given an additional $10 million the subsequent year. The response was overwhelming – over 500 low-income applicants in Marion County alone were turned away. In Valparaiso, 600 applications were submitted for only 285 spots. It is important to note that 41 other states have publicly funded preschool programs. Indiana is unique as businesses around the state have stepped up to the plate and have invested heavily to push to expand the pilot program. The business community realizes that having a quality start to school will ultimately lead to a stronger workforce and better communities.

The day of the Indiana Chamber’s spring board of directors meeting earlier this month, Governor Pence announced that he had sent a letter to Secretary Sylvia Burwell of the U.S. Department of Health and Human Services (HHS) expressing interest in expanding pre-K education for disadvantaged children. HHS oversees preschool development grants authorized under the Every Student Succeeds Act (ESSA). He has also stated publicly his desire to request additional state dollars in the next budget. It should be noted that Pence had the opportunity to apply for $80 million in federal grant dollars in 2014 and decided not to pursue the application at the very last minute, citing concerns regarding federal intrusion. The Governor now states that the pilot is producing great results and the time is right for expansion.

Similarly, Ritz announced a proposed expansion of pre-kindergarten programs in announcing her Imagine 2020 legislative plan the following week. Ritz’s pre-kindergarten announcement included high-quality, state-funded, universal access to pre-K to the tune of $150 million per year. With this price tag, Ritz stated that if the political will is there, the funds will follow. Her plan utilizes reversions from state agencies already made to the general fund and leveraging federal dollars.

Democratic gubernatorial candidate John Gregg joined Ritz this week to discuss more details about the pre-K plan. It was explained that the $150 million per year would be available for 289 public school districts with pre-K programs. The program would be voluntary for students, but would be open to all Hoosier four-year-olds, regardless of family income.

While we are thrilled that leaders of both parties are supporting expansion of pre-K programs in Indiana, per usual, the devil is in the details. Expansion can take shape in many forms: universal coverage for all four-year-olds regardless of income levels, increasing the number of counties in the pilot, expanding access to three-year-olds or changing the poverty-level income requirement. These details all are yet to be determined in each proposed plan.

The Indiana Chamber has partnered with many stakeholders to promote expansion of the pre-K pilot and has been meeting frequently to determine our approach to the 2017 legislative session, our messaging and to work collaboratively with community partners and Chamber members to promote a well-funded, high-quality expansion. We will be relying on employers across the state to help us beat the drum about the importance of a great early start to school, which will help lead to lifelong success.

Letter: Federal Health Insurance Tax Harmful to Employers

The federal Health Insurance Tax is an aspect of the Affordable Care Act that poses a threat to businesses across the country. The following letter of concern from Caryl Auslander, the Indiana Chamber’s vice president of federal affairs, was sent to Sen. Joe Donnelly and explains the Chamber’s position on the issue.

Senator Donnelly,

As Hoosiers, we are proud that our state has shown strong and sustained economic growth ever since the nationwide recession in 2009. It is our concern that the Federal government is hurting, rather than helping, by enacting policies that harm the employer community, specifically small businesses. In particular, we are deeply concerned by the Health Insurance Tax (or “HIT”) that is embedded in the Affordable Care Act.

This provision ensures that those individuals and businesses that have to turn to private insurance companies for coverage are stuck with a disproportionate share of the costs of the ACA. While the original intent of the HIT was supposed to be paid by the insurance companies, in reality the companies really act only as tax-collecting proxies for the Federal government.

When a consumer cannot avoid purchasing a good or service, they have little or no power to resist price increases imposed by suppliers. And when all of the suppliers are charged the same tax, they all have the same incentive to pass it along to their consumers. Thus the HIT forms a hidden tax on health insurance consumers: The families and small businesses who can’t afford to self-insure.

By some estimates, the HIT will cost more than $500 per family every year. A tax burden like that can place real hardship on a middle-class family, push poor families straight into insolvency, and keep small businesses from being able to hire new workers, reinvest in their company or provide other services to consumers. In a small firm with 80 employees, the hidden HIT alone could cost more than $40,000 a year — well over the state’s per-capita income.

The HIT is a hidden and regressive tax, and bipartisan agreement has been enough thus far to delay its full implementation. But middle-class Hoosiers and small business owners here cannot afford the continued uncertainty. On behalf of 24,000 Chamber members and customers across the state of Indiana, it is our request that you place the permanent elimination of the Health Insurance Tax at the top of your agenda. Its unconditional repeal would be a victory for transparency, good government, and economic opportunity for all.

Thank you for your leadership on this issue and for defending the people of Indiana.

Sincerely,

Caryl Auslander
Vice President, Federal Affairs

Telemedicine Movement Moving Forward in Indiana

Virtual doctor measures blood pressure

Our friends at Gibson Insurance posted a blog today about the advancement of telemedicine in Indiana. They also included comments from Indiana Chamber VP Mike Ripley:

Prior to March 21, 2016, Indiana was one of just a handful of states that had not legislatively addressed the subject of telemedicine. Meanwhile Illinois and Ohio currently have proposed telemedicine parity bills but nothing set in stone – and Wisconsin has no parity legislative activity at this time. Michigan’s laws went into effect in 2012 and Kentucky was well ahead of the game with legislation in 2000, but the first state to address telemedicine by law was actually Louisiana in 1995. 21 years ago?! Why was Indiana so late to answer the call?…

WHAT SHOULD INDIANA EMPLOYERS KNOW?
According to Mike Ripley, the Vice President of Health Care and Employment Law Policy at the Indiana Chamber of Commerce, it was surprising the law was not passed sooner, as it had many supporters. Ripley explained that insurance carriers, employers, and health care providers were ready to embrace telemedicine technology, yet the stakeholders could not agree on exactly how it should work in the Hoosier state.
The competing interests that delayed the law were ultimately united when the stakeholders agreed that the standard of care for a virtual visit would have to be the same as the standard of care for an in-person visit. Once all parties were able to rally around this central concept, the bill passed swiftly through the legislature. The standards of care at the heart of the bill are yet to be clearly defined in terms of telemedicine, but you may read the specific language of Indiana’s House Bill 1263 to gain a better understanding of the law.
Although the issues around the standards of care continue to develop, the law clearly states a phone call is insufficient to satisfy the standard of care. We anticipate technology such as video chatting and Skype will be used to effectuate the provision of care by telemedicine. The law also addresses the types of maladies that may (and may not) be treated through telemedicine. In Mr. Ripley’s words, one easy way to remember what is fair game under the bill is “anything ending with ‘-itis’ – is permissible to treat via telemedicine.” The law prohibits narcotic prescribing and psychiatric services through telemedicine.

Furthermore, see our recent blog about the importance of telemedicine, and its potential impact on many quality of life factors.

Secretary of State Launches INBiz Portal to Help Hoosier Businesses

inbizGov. Mike Pence and Secretary of State Connie Lawson recently announced the launch of INBiz, a web portal for Indiana businesses. The following is a release from Sec. Lawson:

INBiz is aimed at streamlining the steps a business takes when registering with the state, including registration, filing, reporting, and making payments. This first phase of the project includes business services within the Secretary of State’s office, and will include services from the Department of Revenue and Department of Workforce Development later this year. As the portal continues to grow, INBiz will become the single point of contact for businesses as they do business with the state.

“From day one of this administration, we have been focused on cultivating a more business-friendly environment that encourages investment and opportunity for all Hoosiers,” says Gov. Pence. “We’ve cut taxes and red tape, invested in our classrooms, our workforce and the infrastructure that makes Indiana the Crossroads of America. In just the last three years our state has added 130,000 new jobs, and we set a record for private sector employment. With the launch of INBiz, we’ll be able to build on this momentum, increase efficiencies and make it easier for businesses to start up, operate and grow within the state of Indiana, saving owners time and money that can be reinvested into growing and operating their companies.”

INBiz furthers Indiana’s position as one of the nation’s most pro-business environments. The site modernizes the current business registration system and enables businesses to open their doors faster. INBiz also utilizes state-of-the-art security features so businesses can feel safe about inputting business information into the system. Ten years ago, Indiana became a leader in business services when it began offering an online filing system.

“INBiz will be the most comprehensive one-stop resource in the nation,” said Secretary Lawson. “It will streamline and expedite the registration and compliance process, reducing the cost of doing business with the state. Today’s launch is just the beginning, and we will continue to add as many services as business owners demand. I am very thankful for the Governor’s collaborative approach on this project. Partnerships like this benefit all Hoosier businesses. INBiz is another significant step in making Indiana a state that works.”

INBiz is available at INBiz.in.gov.

The $9.1 million in funding for the initiative was included in the most recent biennial budget. In March 2014, Governor Pence signed into law House Enrolled Act (HEA) 1198, which mandated executive agency participation in the Business One Stop (now INBiz) online portal.