Indiana governor outlines plan to boost teacher pay

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Indiana Gov. Eric Holcomb used his State of the State address to unveil a plan to create extra revenue for Indiana schools that could be used to increase teacher pay.

Holcomb wants to use $150 million in surplus funds to pay off teacher pension obligations. The one-time state payment is expected to save school $140 million over the next two years, which Holcomb wants to be passed along to teachers' paychecks.


“Just like paying off your mortgage frees up money in your personal budget, this state investment will save all local schools $140 million over the biennium with continued savings thereafter,” Holcomb said in his Tuesday speech.

Holcomb’s two-year budget proposal, presented to lawmakers last week, proposed a 2% funding increase for public schools but did specifically direct money to teacher pay.

Between the two proposals, an extra $472 million in new money would be allocated to K-12 schools over the biennium, the Holcomb administration says.

Holcomb said that his administration will also create a Next Level Teacher Pay Commission, chaired by businessman and community leader Michael L. Smith, to identify resources that can be made available to make sure teacher compensation is competitive with neighboring Midwestern states and be ready to act on by the 2021 legislative session.

Indiana is ranked 31st among the 50 states in teacher pay during 2016, with average salaries of $50,715, according to the National Education Association. The legislature's minority Democrats want the Republican governor to spend more to boost teacher pay. They have a proposal that would provide teachers a 5% raise over the next two years. It would come at a cost of $150 million.

“I am sorely disappointed in the governor’s refusal to provide schools with enough money to pay their teachers a decent wage,” Senate Democratic Leader Tim Lanane ,D-Anderson, said. “Indiana’s teachers make less than all of our neighboring states.”

State Sen. Karen Tallian, D-Ogden Dunes, a member of the State Budget Committee, wants to see more money go towards teacher pay.

Tallian has said that the that the state could spend a portion of the money $1 billion payment the state will receive for allowing the company that operates the Indiana Toll Road to impose a one-time truck toll hike well in excess of the usual annual rate increase. The first $400 million payment was received in October, a second $300 million will be paid in October 2019 and a third $300 million payment is expected in October 2020.

Holcomb has allocated the money to various road and other infrastructure projects without legislative approval.

“He thinks he can spend a $1 billion of Northwest Indiana toll way money off the books," Tallian said. "He refuses to recognize that this the purview of the legislature. The legislature spends and appropriates money, not the governor. The governor needs to stay in his own lane and let us do our job.”

Holcomb used his speech to talk about his spending plans for the money generated by the Indiana Toll Road deal. He said revenue would be used to accelerate regional road projects like completing Interstate 69 three years ahead of schedule. The administration is also pursuing pursuing transformational rail projects in northwest Indiana, a fourth water port in southeast Indiana, and wants more nonstop international flights to Indianapolis.

Holcomb wants to use some of the proceeds to expand broadband connectivity in the state.

Holcomb, reiterated in his address Tuesday night his desire to protect the state's triple-A bond ratings and nearly $2 billion billion budget surplus.

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State budgets Infrastructure Public pensions Eric Holcomb State of Indiana Indiana
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