It’s not always a popular argument around the Statehouse that a stronger Indianapolis region means a more successful Indiana; however, new data reported this week reinforces the case that a competitive Indy is more important than ever.
Indy’s Metro Momentum
Indiana’s population grew by 21,000 Hoosiers in 2016 (one of the slowest years since the ‘80s, according to an IU economist – and this is before Tom Crean puts his house on the market). In more than two-thirds of Indiana’s counties, more people moved out than moved in.
The statewide numbers are pushed into positive territory by just a few metropolitan counties, led by the Indy metro: Eight of our nine counties had population gains, led by Hamilton County (Marion County added roughly 3,200 new residents).
Greater Indianapolis has been responsible for 70% of the state’s population growth in recent years. The Fort Wayne and South Bend regions, college towns (Monroe and Tippecanoe Counties) and a few Ohio River communities (part of metropolitan Louisville) also pitched in to make up for losses last year.
In today’s talent economy, population often predicts prosperity. The Indy Chamber has relentlessly focused on our region’s need to keep pace with the ‘Metropolitan Revolution:’ According to Brookings, the largest 100 regions – with Indy near the middle of the list – are crowded with two-thirds of the U.S. population and 74% of its college graduates…and they’re inventing 80% of recent patents, launching 85% of all new businesses since 2010, and generating 66% of our GDP.
In all, the Indianapolis region produces 40% of the state’s total economic output and tax collections – a very real fiscal consideration for lawmakers. We talk about Indy’s position as the state’s dominant economy in our Regional Cities plan circa 2015.
Capital for the Capitol
It’s not hyperbole to say that Indiana relies on a healthy Indy to keep the rest of the state off economic life support. And let’s also keep in mind that the average Indy taxpayer contributes hundreds of dollars more in state taxes per capita than other Hoosiers…
Looking at it this way, much of our agenda asks for only modest reinvestment of a sliver of these revenues to programs that support urban regions, along with some policy options and local flexibility to help deal with some of our unique challenges. For example:
Early Learning – Pre-K is clearly a statewide priority; advocates are pushing for a $50M investment that would aid families across Indiana. But in cities where poverty tends to concentrate in urban neighborhoods and the K-12 system is beset by challenges, it’s especially critical that low- and moderate-income children have every opportunity to start school prepared to succeed. (Unfortunately, the legislative vehicle for early learning barely expands the existing pilot – the stripped-down HB1004 – now substantively identical to SB276 as we detailed last week – was heard in Senate Appropriations this week.)
Infrastructure (and Direct Flights) – As centers of commerce, metropolitan regions also need to be connected by accessible, multi-modal transportation infrastructure to key markets across the country…and increasingly, around the world. As we’ve repeated again and again, we support the long-term approach reflected in HB1002 to provide sustained investment in the basic assets that support our core industries and keep our economy moving.
An issue that’s received less attention as a part of Governor Holcomb’s ‘Next Level’ plan – but was summarily omitted from HB1001 – is a $5M appropriation supporting international flights to major Indiana airports (like Indianapolis International). Major metro economies are global; the Indy region accounts for nearly half the state’s total exports, and drives its foreign investment totals. Our growing tech sector is also truly global – the flow of data and innovation transcends borders.
Indiana does an excellent job moving goods nationally and internationally. We must do better helping the skilled workers and key executives who make location and investment decisions get to and from Indianapolis, and the rest of the state.
Regional Cities – SB507 passed out of Ways & Means this week towards second reading, moving entrepreneurship programs under the authority of the Indiana Economic Development Corporation (IEDC) and making administrative changes to the Regional Cities Initiative. But HB1001 fails to fund Regional Cities, depriving Indiana’s metros of opportunities to invest in quality of life efforts to attract and retain talent.
Workforce Development – HB1008 was drafted to have more coordination between Department of Workforce Development(DWD), the Commission on Higher Education (CHE)and Ivy Tech. The overall purpose of the bill is to more accurately identify workforce needs with DWD and drive this information to be taught under CHE and Ivy Tech curriculum. The original version of the bill had an emphasis on workforce grants where businesses could further train their existing workforce for high demand jobs.
Recent changes to the bill eliminates the Works Council and instead creates a Governor’s advisory committee. The changes also include the requirement of a pilot program in DWD, and mandates the program to continue in all schools upon the completion of the program’s creation. The federal funding streams for Career Technical Education (CTE) would be consolidated from nine categories to three categories. And CTE funding would remain under the Department of Education instead of being transferred to DWD due to amendment 10 that was passed in the Appropriations Committee yesterday. However, the final outcome of this bill will based on the coordination between HB1008 and SB198 Career and Technical Education.
Certified Tech Parks – HB1601, strengthening accountability for the tech park program, passed second reading in the Senate; we value local flexibility to develop innovation districts like 16Tech in Indianapolis – thoughtfully planned in communities with advanced industry assets and workforce potential, these can be powerful magnets for high-tech growth. We must also reward certified tech parks that are truly doing impactful work to build Indiana’s tech ecosystem in effective ways.
Second Chances – It’s no secret that the state has struggled with public safety. Crime is an issue in communities large and small, but it is felt most acutely in larger cities – along with the socioeconomic issues that persist after the convicted have paid their debt.
The Indy Chamber applauds Mayor Hogsett’s push for criminal justice reform that looks beyond incarceration to what comes next. That’s why, for example, we support SB9 reforming the punitive limits on SNAP benefits for ex-drug offenders.
We need to focus on helping ex-offenders transition to becoming productive taxpayers – a path to joining the legitimate economy instead of sliding towards recidivism. The Chamber testified and advocated for "negligent hiring liability protection" in SB312 ("Use of Criminal History in Hiring") to provide reasonable protection for employers who provide these opportunities. The bill passed 11-0 in Courts and Criminal Code after long debate.
Will We Idle or Invest?
We call the regional economic development strategy spearheaded by the Indy Chamber ‘Accelerate Indy’ because it’s geared towards keeping pace and gaining ground on the other major metros that are catalysts for economic growth across the country. We’ll continue to drive forward, but our task will be easier if the General Assembly shows a similar inclination to pass a higher-octane agenda.
We’ve highlighted the challenges in the proposed presidential budget that takes an austerity axe to the Small Starts program (and Indy’s Red Line rapid transit grant) and Community Development Block Grants, among other initiatives aimed at Metropolitan America.
We hope that this approach isn’t mirrored at the Statehouse by a “slowdown budget” that misses opportunities to invest in long-term success for the metro regions that are helping Indiana build a high-value economy to accompany its low-cost reputation.