House Democrats say evidence tax incentives are bringing business to Indiana is ‘anecdotal’ at best

INDIANAPOLIS — As the state commits millions of dollars in incentives to a new EV battery plant, some lawmakers are saying not so fast, claiming there’s little evidence that big tax breaks are giving Hoosier big returns.

This week, the Legislative Services Agency highlighted 10 of 65 tax incentives it’s reviewing to the Fiscal Policy Interim Study Committee.

State Rep. Gregory W. Porter said house democrats have been asking for the exact number of jobs these tax incentives have created for the past eight years—adding they’ve yet to receive a concrete answer.

“Tax incentives that have been given there—what’s the return on investments?” Rep. Porter asked.                                                                                                          

”There’s no direct proof that we actually gained any particular businesses because of these incentives,” State Rep. Ed DeLaney said.

Some republicans say the proof is in the pudding. State Rep. Jeff Thompson said Indiana ranks number one in the Midwest for economic development, and that more in-depth studies are needed before a conclusion on tax incentives overall can be made.

”We’ll try to clarify that, exactly to what degree and put numbers to that, so again, more study, more information, more data,” Rep. Thompson said.

The IEDC has committed up to $60 million in various conditional tax credits to Stellantis for a second EV battery plant in Kokomo. Indiana Secretary of Commerce David Rosenberg said the IEDC is investing in jobs that have an average hourly wage nearly 20 percent higher than the national average.

“Eighteen months ago, we had zero semiconductor companies here, now we have seven; eighteen months ago, we had zero EV battery facilities, and now we have three,” Rosenberg said. “Our pipeline is nearly $100 billion of potential investment.”

However, State Sen. Fady Qaddoura said he’s concerned the numbers aren’t there to confirm this investment is the right one.

“My concern is not that we’re attracting that project, my concern is that there’s not information to assure the public that we used your money to the best of our ability,” Sen. Qaddoura said.

The Legislative Services Agency said its second review will cover tax incentives from 2019-2025.