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

Gubernatorial Race: John Gregg, Eric Holcomb Offer Policy Insights in BizVoice

The 2016 election season has been like no other – nationally and in Indiana. In the September/October issue, the Indiana Chamber’s BizVoice® magazine talks with some of the leading candidates as the road to November winds toward a close.
Gubernatorial race: John Gregg, Eric Holcomb offer policy insights:

greggBV: What areas might we be in disagreement?

Gregg: “I don’t think there are those issues that exist. That’s why I referred to the old fights. Let’s throw those elephants on the table. Right to work would have been one in the past, but that is the past. That’s not going to change. You know the makeup of the Legislature. I think you’ll find we share a lot of common goals together.

“We may disagree from time to time on how to get there, but the truth of the matter is that in our administration we’re going to be dealing with an overwhelming Republican Legislature. Having a check and balance – right now there is not one – is good.”

Read the full story online.


holcombBV: Why is Indiana having such success attracting tech companies?

Holcomb: “I would say don’t just ask me, but the CEOs that are making the decisions that are creating not just the hundreds, but the thousands of new high-tech jobs coming to Indiana – not Austin, Texas; not Boston, Massachusetts; not San Francisco, California; not Chicago. They’re choosing to locate in Indiana, a state that has traditionally been known as a manufacturing state, because of those low tax rates, the reasonable
regulatory environment. We have the great communities that are offering hungry, world-class university graduates a good opportunity and a good job.

“(Our momentum will increase) if we continue to get the basics right and don’t make promises we can’t keep, start writing checks we can’t cash, start raiding the kitty – if we stick to the successful practices that we’ve experienced over the last 12 years and we offer good government service that operates at the speed of business.”

Read the full story online.

Road Funding Committee Discussions Ramp Up

9809397An in-depth interim summer study committee on road funding (called FIRSST) held its second meeting last week. This was an input session that focused on how Indiana’s road conditions and funding compare to other states.

There were several informative presentations from several different groups including Conexus and the National Conference of State Legislatures. Points of interest from the discussion:

  • For the U.S., average funding sources for highways and transit are 25% federal, 40% state and 35% local.
  • Indiana’s deficient roads cost $391 per motorist per year. This includes flat tires, bent rims and other costs.
  • Some 16% or 9,965 miles of Indiana’s roads are considered in poor condition; that ranks us third among six Midwestern states.
  • A total of 10.2% or 1,944 Indiana bridges are considered deficient in quality; that ranks us second among six Midwestern states.
  • Investment in road infrastructure is declining, even when adjusted for inflation.
  • There are 54 potential funding sources for road funding ranging from fuel taxes to parking meters.
  • Fuel taxes have not kept up with the infrastructure needs. Automobiles are more fuel efficient and inflation has been eating away the buying power of gas taxes. Indiana last raised its gas tax in 2003 and it is not indexed for inflation.
  • As electric cars become more popular, very few states – including Indiana – impose fees for their use of roads. Of the 10 states that do, the fee ranges from $47.50-$200 per year.
  • Of the 50 states, 36 – Indiana among them – have toll roads.

The Indiana Chamber will continue to encourage the development and implementation of fiscal systems to support the array of transportation infrastructure projects critical to economic growth. The next FIRSST meeting is scheduled for September 29.

Immigration Matters Continue to Be Debated in Summer Study

The Senate Select Committee on Immigration Issues met recently for its fourth meeting. An interesting presentation was provided to legislators by the former director of the statistics division of the U.S. Immigration and Naturalization Service.

National undocumented immigrant information was provided to the committee along with more specific information for Indiana. Of the 11 million undocumented immigrants living in the U.S., 106,300 reside in Indiana. That number represents 1.6% of Indiana’s total population.

Marion County, primarily in Wayne and Decatur townships, had the largest population of undocumented immigrants with 12,200; Elkhart and Lake counties came in second and third with 9,400 and 6,100 undocumented immigrants, respectively. Approximately 71,000 overall are in the labor force with 21,500 working as operators, fabricators and laborers, with another 19,100 working in services positions. Sixty percent or 64,200 have lived in the U.S. for more than 10 years and 77,600 (73%) are between the working ages of 18 and 44. Information on origin of birth was also provided with 67,700 (61%) coming from Mexico.

The committee also heard testimony from Goshen College about unauthorized immigrant students. It was reported that since July 1, 2011, Indiana has prohibited resident tuition rates and state financial aid for undocumented students. Eighteen states, Illinois being one, allow in-state tuition for undocumented students.

Goshen College has provided scholarship aid for undocumented students for the past eight years. During the 2015-2016 academic year, Goshen provided $123,000 in aid for these students. The next hearing is scheduled for September 21. It is uncertain as to what the committee will decide to do with the information garnered from the four previous hearings and the three yet to be held. The Indiana Chamber will continue to be involved in these discussions.

Connect, Make an Impact at D.C. Fly-In

congressIndiana Chamber members go to Washington each September to discuss key policy issues with the Indiana congressional delegation. In 2016, a little politics might be worked into those conversations. Either way, it’s your opportunity to make an impact.

The event is the annual D.C. Fly-In on September 14-15. It features a roundtable discussion with Indiana’s congressional delegation on the opening night. Day two includes a panel of national and state issue experts, followed by group visits to congressional offices.

Expect to learn more and advocate on key issues such as transportation, trade, immigration and the Every Student Succeeds Act.

“It’s a very interesting time in Washington,” remarks Caryl Auslander, Chamber vice president of federal affairs. She points to a few (of many) reasons why: “Indiana will have a new member of Congress with Sen. Coats retiring. And with the appointment of a new Supreme Court justice nominee on the line, the potential for a change in power in the Senate and the Presidential race is extremely important.”

Register today for the D.C. Fly-In online or by calling customer service at (800) 824-6885. Cost is $149 per person, with group discounts available. Each attendee is responsible for securing travel arrangements. Discounted hotel rooms are available for Chamber Fly-in guests at the Hyatt Regency Washington on Capitol Hill.

Zimmer Biomet is the dinner sponsor. The breakfast program sponsor is Allegion PLC. The hospitality sponsor is Build Indiana Council.

Event sponsors: The Boeing Company, Duke Energy, Hartman Global IP Law, The Kroger Co., Old National Bank and Wabash Valley Power.

Additional sponsorship opportunities are available by contacting Jim Wagner at (317) 264-6876.

“The entire Indiana congressional delegation is typically involved in some way in this event,” Auslander comments. “To bring everyone together in the same room is pretty amazing and an incredible benefit for our members.”

Digital: A Disruption to Embrace

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The Kauffman Foundation’s Jonathan Ortmans offers thoughtful perspective on entrepreneurship and technology topics. Below is a summary of his latest entry.

One of the great drivers of innovation today is the promise of digital disruption of complex and regulated industries. Digital disruption is not only behind the public sector’s move toward open government and open data, but is also the rise of civic-centered startups that are changing the rules of the game for traditional industries. It is time for a new wave of policymaking that anticipates a whole new set of issues for policymakers.

A new sense of urgency is called for as policymaking for the digital economy accelerates in response to what entrepreneur Steve Case calls “The Third Wave” of the Internet revolution.

As 1776 co-founder Donna Harris explains, “as digitization moves from basic applications like social media and e-commerce to more complex industries like education and healthcare, entrepreneurs tackle harder and harder problems. And that means government is more involved and that legacy institutions will inevitably play key roles … Frameworks established decades ago no longer apply, and leaders at all levels need to be proactive in understanding and regulating for a digital economy.”

Creating new regulatory frameworks for the digital workforce is a challenge. As I discussed recently, a Princeton/NBER survey found that the share of workers engaged in alternative work arrangements (e.g. independent contractors and freelancers) was 15.8 percent in 2015, up from 10.1 percent in 2005. Beyond the safety net challenges posed by the so-called “gig economy,” the impact of the broader digital economy reminds policymakers that they need to write new rules for an era where digital disruptions are giving individuals greater power and freedom to write their own destinies. The possibilities of the digital age include new remote, flexible and on-demand work opportunities – and a clear shift of power from institutions to individuals as transparency increases.

Yet most cities, let alone the federal government, are not ready to leverage digital disruption. Innovation That Matters, a pioneer report in understanding digital disruption in the United States, ranks 25 American cities’ readiness to capitalize on the inevitable shift to a digital economy, and provides metrics that city leaders can use to evaluate their progress in developing their digital economies.

The greatest policy risk of all in digital disruption is ultimately policymakers reacting too slowly or providing what Harris calls a mediocre legacy of a “patchwork of laws and tensions.” There are some exceptions to follow from smaller nations that are leveraging the fact that small is beautiful and also more doable. Nations like Estonia for example, have their top authorities leading their countries digital economies, through initiatives in digital infrastructure and even an e-residency program for global entrepreneurs.

Getting the public sector up to speed with the digital revolution is not an easy process. Internal capacity and cybersecurity are two large roadblocks. And it will take many intra-preneurs in government to make the necessary changes, as well as increased rapprochement to civic entrepreneurs who can help one of society’s most traditional sectors – government – react responsibly and responsively to digital disruption. Let the work begin.

Read the full post online.

JOIN US: Learn more about the Indiana Chamber’s new Technology & Innovation Council. Want to participate? Contact Mark Lawrance at mlawrance(at)indianachamber.com.

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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.