Dont reduce Regional Cities grants, state told’

February 25th, 2016

News Coverage:

February 25, 2016

Dont reduce Regional Cities grants, state told

\'A real return\' on investment vital

NIKI KELLY | The Journal Gazette

INDIANAPOLIS – Lawmakers on Wednesday pushed back against Gov. Mike Pence’s request for additional Regional Cities funding while the three regions that received the “awards” pressed their case for transformational change.

The House Ways and Means Committee didn’t vote on Senate Bill 302, but it must do so by Monday to meet legislative deadlines or the bill dies.

A key question at the committee hearing was why the Indiana Economic Development Corp. awarded grants to three regions when the legislature had only provided $84 million to be split between the top two.

But the most important question – at least to the regions whose projects are on hold awaiting a decision – is what happens if lawmakers don’t pony up. And the answer was murky.

“We’re kind of backed up against the wall,” said Rep. Cherrish Pryor, D-Indianapolis.

Northeast Indiana, the Evansville area and the South Bend region were all deemed winners of the Regional Cities initiative in December. The goal was to stimulate regional thinking and ultimately attract talent and population to Indiana.

Statewide, about $2 billion in projects is envisioned, with about $525 million to be spent the first three years. Locally, the northeast Indiana plan targets regional trails, a riverfront project in Fort Wayne; arts centers and revitalizing communities.

Senate Bill 302 would provide an additional $42 million from tax amnesty proceeds for the third winner.

Rep. Todd Huston, R-Fishers, said he likes the program but questioned why the projects weren’t ranked and what the possible consequences are.

John Thompson, an IEDC board member and chair of the strategic review committee, said if additional money isn’t approved, he doesn’t think the $84 million should be split three ways. That would leave two regions with $42 million and one without any funding.

He and Indiana Secretary of Commerce Victor Smith stressed that the regions’ economic development proposals were better than expected, using the word “phenomenal” several times. “Three plans stood out as exceptionally bold,” Smith said.

He also said the decision to award three regions was made about the same time the state’s tax amnesty program was concluding, and Pence officials could see there would be extra money available.

John Sampson, president and CEO of the Northeast Indiana Regional Partnership, helped spearhead the effort and told the group to focus less on the initial state investment and more on attracting people who want to live and work in Indiana.

He also urged the group not to split the money three ways. “Concentrate it in a way that you get a real return and a national identity for our state.”

Tim Pape, co-chair of the local effort, said the governor and legislature have put the state in a great place as far as tax structure for businesses. The next part is focusing on creating places where people want to be.

Jeff Ostermann of Sweetwater Sound Inc. in Fort Wayne said the company struggles daily to attract creative and musical types to the area.

He said they ask about the arts scene and the trail system – things that are the focus of the northeast region’s plan.

“It’s a critical factor in growing our business,” Ostermann said. “We need the talent for a bright future.”