How will Indiana fare under the current proposed $789 billion stimulus package? Read the analysis provided by MEK Public Affairs below and then add your comments.
This week, as Congress reached an agreement on a $789 billion federal stimulus bill, the Indiana House passed a $1 billion state stimulus package designed to put Hoosiers to work on local infrastructure projects.
On February 10, Indiana House members voted 88-11 in favor of House Bill 1656, or the “stimulus bill,” generating bipartisan support at least temporarily as the bill moves to the Senate for consideration.
Currently (as of February 11), the $1 billion state stimulus bill would rely on $500 million from the trust fund created by the $3.8 billion lease of the Indiana Toll Road, plus $250 million from the federal highway funds that the state has and $250 million from money the state expects to receive from the federal stimulus package. The money would be direct $500 million to counties and $500 million to cities and towns for local road projects, potentially creating thousands of jobs.
While both state Democrats and Republicans alike agree that the bill is a work-in-progress, many Republicans believe that chances for passage in the Senate diminish as long as Major Moves trust fund money remains part of the package.
U.S. Senate, House Reach Agreement on Federal Stimulus
The U.S. Senate and House negotiators reached an agreement February 11 on a $789 billion stimulus plan after scaling down the versions passed previously by both houses, including an $838 billion Senate plan passed February 10. This occurs just days after President Barack Obama stumped for the stimulus package in Elkhart, Ind., one of the hardest hit economies in the U.S. with a 15.3 percent unemployment rate. The area has seen a drastic rise in unemployment due to the flailing RV industry.
During the town hall style event in the packed local Concord High School gymnasium, President Obama told the audience that failure to enact the stimulus package in Congress could mean "millions more jobs will be lost, and national unemployment rates will approach double digits."
While most Hoosiers, and most of the nation, support some sort of federal stimulus package to help the struggling economy, many don’t quite understand the specific implications the funding package will have on our state. How lawmakers have decided to resolve differences between the House and Senate versions of the bill will make a big difference in that regard.
For example, while the $819 billion House stimulus bill provided about $810 million in education funds to Indiana and about $518 million in general-purpose state budget aid, the $838 billion Senate version previously provided only about $652 million in education funding and no general aid. Other major differences in the House and Senate bills that affect Indiana include funds to renovate and repair Indiana schools, a homebuyer tax credit, and a “patch” for the alternative minimum tax.
