T Indiana LEGISLATIVE SESSION 2025 NAVIGATING FISCAL CHALLENGES AND LEGISLATIVE PRIORITIES BY DAX DENTON & ROSS TEARE, INDIANA BANKERS ASSOCIATION The Indiana General Assembly’s 2025 session is shaping up to be pivotal. As an odd-numbered year, this “long session” centers on crafting Indiana’s biennial budget, which determines state funding for the next two years. The session spans nearly four months and has a legislative deadline of April 29 for completing all activities. Before 1970, these budget years were the only times the General Assembly convened. There were no “short sessions” in even-numbered years. This meant that if an issue surfaced after the legislature adjourned, Hoosiers had to wait nearly two years before lawmakers could address the matter. Unlike the 2024 short session, which ended earlier than expected, this year’s long session is expected to utilize its full 16-week timetable, which started Jan. 8. The budget process will dominate the agenda, with the House spearheading efforts in the first half and the Senate taking over in the second half. Following the record-setting brevity of the 2024 “transition session,” the 2025 session is expected to be more intensive. Lawmakers are prioritizing property tax reform, infrastructure improvements, energy policy, housing affordability and maintaining funding for public safety and education. They also face the significant challenge of setting the state’s budget without the cushion of high revenue growth from the COVID-19 pandemic, which bolstered Indiana’s reserves during the previous budget cycle. The transition to a new administration adds to the complexity as Gov. Mike Braun’s priorities take center stage as he settles into his role. A blue-ribbon tax committee has spent the past two years studying Indiana’s tax system. Initially focused on eliminating the state income tax, the committee shifted its attention to property taxes. This focus will shape the 2025 session, with the legislature expected to introduce several property tax bills. Gov. Braun’s administration is also proposing a property tax plan aimed at alleviating financial pressure on Hoosiers who have faced rising property tax bills in recent years. Lawmakers anticipate compromises between Braun’s proposals and legislative alternatives, especially given the financial constraints of a budget year. The tighter financial conditions of 2025, driven by reduced revenue growth, add another layer of difficulty to crafting a balanced budget. Lawmakers must strategically address critical state challenges while providing tax relief and maintaining essential services. The IBA’s government relations team is defending against problematic legislation and proactively addressing issues identified over the summer related to public deposits. We are engaging in discussions to mitigate risks to the banking industry while advocating for sound public policy. The long session offers a crucial opportunity to tackle these and other pressing issues. Stakeholders widely agree that annual legislative sessions are vital for ensuring responsive and effective governance. With a packed agenda and significant fiscal challenges, Indiana lawmakers have their work cut out for them in 2025. However, the extended timeline provides the opportunity to navigate these complexities and deliver meaningful outcomes for Hoosiers. GR SUMMIT 20 HOOSIERBANKER
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