Senate is next stop for balanced budget amendment

By James Polston
TheStatehouseFile.com

INDIANAPOLIS ­— A committee Tuesday advanced a key piece of the of Senate Republicans’ legislative agenda, amending the state constitution to prevent lawmakers from passing a budget that spends more than the state’s projected revenue.

The Senate Tax and Fiscal Policy Committee passed Senate Joint Resolution 7 with a 10-3 vote, making the next stop for the amendment the Senate floor.

The Tax and Fiscal Policy Committee passed Senate Joint Resolution 7 with a 10-3 vote. Photo by James Polston, TheStatehouseFile.com

The Tax and Fiscal Policy Committee passed Senate Joint Resolution 7 with a 10-3 vote. Photo by James Polston, TheStatehouseFile.com

The author, Sen. Brandt Hershman, R-Buck Creek, said in other states the absence of a balanced budget has led to a “death spiral of spending and pension debt that has been enormously difficult for them to escape.”

The Indiana legislature typically passes a balanced budget, except when there is an economic downturn or when trying to cut taxes to reduce a big state surplus. Former Gov. Mike Pence sparked the discussion in his 2015 State of the State address when he called for a balanced budget amendment to be passed.

The current constitution bars the state from creating debt, but language does allow the General Assembly “to meet casual deficits in revenue.” The constitution, however, does not define “casual deficits.”

“Courts have interpreted casual deficits very broadly under the idea of legislative authority,” Hershman said.

The proposed amendment does allow emergency spending if two-thirds of the legislature votes in favor.

“This is a promise, in reality, to the to the citizens in this state that we will live within our means,” said Sen. James Buck, R-Kokomo, “or should expenses arise beyond our control, we will rise to that level of expectation.”

Justin McAdam, general counsel and policy director for the Indiana Office of Management and Budget, said the state already has the best credit rating a state can have, but a balanced budget amendment would ensure the safety of Indiana’s credit score long-term.

Sen. Mark Stoops, D-Bloomington, was one of three members of the tax committee that voted no to the amendment.

“In my short time here, the number of constitutional amendments I’ve seen passed through the legislature surprises me,” Stoops said. “The constitution seems to be a guiding document that is continually being expanded with unnecessary language.”

Stoops said Indiana is already committed to a balanced budget and he believes that there are better ways to enhance Indiana’s reputation.

If the amendment passes the General Assembly, it could be put on the Nov. 2018 ballot for voters to approve.

James Polston is a reporter for TheStatehouseFile.com, a news website powered by Franklin College journalism students.

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