2019 Economic Development Wishes For Indiana
As we begin a new year, most Hoosiers are filled with hope and optimism for their families. Economic conditions continued to improve in 2018 and the outlook for 2019 is positive. There is much hard work ahead, but our state's leaders have proven that they can tackle major challenges and look to the future.
Here are my top economic development wishes for Indiana as we begin a new year:
Hate crime legislation: Indiana is long overdue in enacting hate crimes legislation. This is important to economic development because more and more companies are examining these types of issues when considering where to invest capital and hire team members. Companies want to make sure that their employees are afforded protections against inappropriate actions by an element of our society. Unfortunately, our state has had a few recent cases of crimes being committed against people or organizations based on race and religion. This is a very important issue for our state and it is time to adopt legislation to address it.
Financing flexibility for communities/counties/regions: Our state should grant local elected officials more flexibility in how they can fund important quality of place, infrastructure, and talent projects in their areas. In the era of local government finance after property tax reform, many local units of government have been limited in their ability to fund strategic investments. As an example, many other states allow greater flexibility to bond against local sales and personal income taxes or to pool tax dollars on a regional basis, but Indiana continues to be very restrictive in this area. Economies are driven at a local and regional basis and the state should empower local elected officials to encourage creativity. If residents of a local community do not like how funds are being spent, they can vote elected officials out of office, because after all, it’s their money.
Continued expansion of early childhood education for low income families: Our state should continue to expand its pre-K pilot program and make it available to more children throughout Indiana. An earlier start in education for children paves the way for greater learning and success in life. If we are going to help families trapped in poverty in rural and urban areas of our state, there are not very many better ways to do so than the funding of early childhood education. In a period of economic growth when the state has more revenue to invest in key initiatives, the time is right to expand pre-K.
Overhaul of workforce development programs: While Indiana has some momentum in the area of workforce development with the Next Level Jobs Program, we have much work ahead of us. Governor Eric Holcomb, Speaker of the House Brian Bosma (R-88) and outgoing Senate President David Long (R-16) have correctly concluded that we have too many training programs operating in too many silos in our state to leverage the best results from the use of the money. In addition, our educational attainment and ongoing training of adults already in the workforce rank in the bottom 10 states in the U.S. The Indiana General Assembly has discussed the issue during the past two legislative sessions, and 2019 is the year to enact a "best in class" workforce development structure in Indiana.
Data center projects: For many years, Indiana has said that it wants to attract data centers to the state. While these projects are not usually big job creators, they bring significant capital investment and property tax revenue to our communities to help fund local government. Our state's problem is that we have the "triple whammy" of business personal property taxes, sales taxes on electricity, and sales tax on equipment purchases for data centers. It is no wonder that our state has struggled to win large data center projects, while states like Iowa and Ohio have been very successful. The state should adopt legislation to provide some form of sales tax relief related to data centers before we miss an opportunity to capitalize on large cloud computing projects.
Economic development incentive improvements: Our state has been fortunate to have good incentive tools in place during the past 10 - 15 years, but they are not as competitive as they were when they were originally created. Innovative governors in the Midwest and across the United States have greatly enhanced economic development incentive programs to deliver greater benefit to companies. As an example, Indiana should closely examine making the Venture Capital Tax Credit transferable, refundable or sellable in order to leverage more investment from non-Indiana residents. In addition, the Hoosier Business Investment Tax Credit needs to be updated to reflect the changing economy. This will help ensure that Indiana remains competitive for economic development opportunities.
Larry Gigerich is executive managing director at Ginovus.