The Indiana Senate approved a $30 billion budget Tuesday night that includes new money for several highway expansions and a package of tax cuts.
Senate Republicans crafted the plan, keeping much of the additional education spending that House Republicans added to their budget proposal in February. But the Senate package also includes a $150 million cut to personal income taxes as a nod to Gov. Mike Pence, who originally wanted a $500 million cut in the tax.
The Senate voted 38-12, with one Democrat joining all the Republicans in supporting the plan. Differences between the plan and the House's budget proposal will now be worked out by a conference committee. The House plan doesn't include the personal income tax cut, which has been the governor's key agenda item.
Senate Appropriations Chairman Luke Kenley, R-Noblesville, said the budget includes a strong balance of tax cuts to spur the economy and restoration of budget cuts sustained through the recession.
"This is what I call an opportunity budget, this is an opportunity for Indiana to move forward," he said.
Lawmakers are working with $2 billion in reserves and a $500 million surplus left by former Gov. Mitch Daniels, but they are also looking for ways to restore cuts to education and local roads that Daniels used to help burnish the state's finances.
The Senate budget would devote $200 million a year to expand Indiana's interstate highways. The money would pay for the construction of additional lanes on Interstate 65 and Interstate 70, as well as a further extension of Interstate 69. The budget would also help pay for the Indiana Commerce Connector, a new highway circling central Indiana from Martinsville east to Muncie.
The Senate also proposes eliminating the inheritance tax, and cutting a tax on banks and financial institutions by roughly $150 million.
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