GOP balks at tax plan

INDIANAPOLIS -- Majority House Democrats got enough Republican support to make changes in their sweeping tax-and-budget package Tuesday, but they lacked enough votes even from their own party to pass the overall plan and send it to the Senate.\nAfter outnumbered Republicans went along with an amendment they said "made a bad bill better," Democrats declined to call the legislation down for final passage. It remains stalled in the chamber, which Democrats control 53-47.\nThe changes, including elimination of income tax increases, were designed to make the bill more palatable to wavering Democrats and hopefully gain some GOP support for the overall package. But the effort failed to garner even the minimum 51 votes needed for passage.\n"At this time we don't have the votes," said House Majority Whip Paul Robertson, D-DePauw. "I mean, if we would have had the votes, we would have gone ahead and moved the bill today. There's no secret about that."\nDemocrats said the changes were "major concessions" to Republicans. The amended bill no longer includes an income tax increase, it provides more property tax relief to homeowners and includes a spending cap on future state spending, except for education, Medicaid, property tax relief and teacher pensions.\n"This is a major merger of the two parties," said House Ways and Means Chairman B. Patrick Bauer, D-South Bend. "I believe it's now time for both parties to come together and move this bill over to the Senate and keep the process going."\nRepublicans provided enough votes to suspend procedural rules and make changes to the bill, but said they would not support the revamped package because it still included tax increases to shore up the state's budget deficit.\nThe bill would still raise sales taxes, increase taxes on cigarettes and riverboat casinos, and suspend two tax cuts approved in 1999 that allow individuals and businesses to offset about $163 million a year in property taxes.\nMost of those tax increases would be used to close the budget gap, which is projected to grow to $1.3 billion by July 2003 if nothing more is done.\nRepublicans in the House and those who lead the Senate say they are willing to work on tax restructuring -- raising some taxes to lower property taxes and promote economic development. But they have continued to oppose tax increases to fix the deficit.\n"We said from day one that we're not going to support tax increases for new spending," said Rep. Jeff Espich, R-Uniondale.\nAlthough the House has until next Tuesday to pass bills and send them to the Senate, Democratic leaders spoke of urgency in getting some GOP support to get the stalled legislation moving.\n"This bill doesn't get out of here without Republican support," said House Speaker John Gregg, D-Sandborn.\nTuesday's developments keep open the possibility of that happening. House Republican Leader Brian Bosma of Indianapolis said his members were willing to negotiate.\nBut he urged Democrats to separate tax provisions to fix the budget from those designed to restructure taxes.\n"The admirals of the world have put these two bills together so the common guy who wants to navigate this cannot do it," Bosma said.\nBauer suggested that House Republicans were playing an "end game" in the middle of the session, instead of supporting the bill to keep the process moving.\nBut when asked if he had enough Democrat votes to pass the plan in the House, he said, "We have more Democrat votes than I expected, I can tell you that."\nSenate Finance Chairman Larry Borst, R-Greenwood, said the changes Bauer offered Tuesday were a clear sign he was "trolling for votes."\nEven if the House passes a major deficit-reduction and tax-restructuring proposal, Borst said Senate Republicans would recast it into something "different than you've ever seen."\nAmong other things, Borst has said any tax-restructuring proposal should shift all school operating costs from local property tax rolls to the state, instead of just 50 percent as O'Bannon and House Democrats have proposed.\nHe has also said any plan should contain caps to control annual increases in property taxes.