Perpetual Pay Increase

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State Senate Bill 401 passed the Indiana Senate by a vote of 39 to 9 on February 27, 2007, passed the Indiana House of Representatives by a vote of 60 to 39 on April 10, 2007, and was signed by the Governor on April 24, 2007.

SB 401 was Taxpayer UNfriendly because the compensation of General Assembly members became more than the median Indiana household income.

SB 401 cynically combined politically what should properly be included in three separate bills. Complete information for SB 401 can be found at http://www.in.gov/apps/lsa/session/billwatch/billinfo?year=2007&session=1&request=getBill&docno=401.

The three primary topics of SB 401 affect Indiana General Assembly members and include a salary increase, the elimination of taxpayer-paid lifetime health insurance, and the elimination of the $4 match by taxpayers for each $1 of pension contribution. Our legislators received an excessive salary increase in return for eliminating the extravagant perks they should not have in the first place.

It is Taxpayer Friendly that SB 401 eliminates taxpayer-paid health insurance for former legislators (and spouses) who have served at least four terms and not retired from legislative service by July 31, 2007. Future retiring legislators will be required to pay all of the premium if they qualify for the state employee group health insurance program.

It is also Taxpayer Friendly that SB 401 changes legislator pension benefits effective January 1, 2009. The state's contribution to legislative retirement plans would be set at the same percentage that goes into the Public Employee Retirement Fund for all other state employees. This percentage is currently 9.3% of salary. The bill repeals the current statute establishing the state's annual contribution for a participant in the legislator's defined contribution plan as 20% of the participant's annual salary.

According to the February 21, 2007, Indianapolis Star, the average annual income paid by us taxpayers to our state legislators the past two years was $42,593. This includes an annual salary of $11,600, an in-session per diem of $137 a day, an out-of-session per diem of $54.80 a day, and extra pay for serving in "leadership" positions and on the Budget Committee.

SB 401 sets the salary of General Assembly members at 18% of the annual pay of trial court judges beginning January 1, 2009. Legislator pay will automatically increase annually, so long as judges' and state employees' pay do. Based on today's judicial pay of $115,282, lawmakers would have a salary of $20,750. The average annual taxpayer-paid state legislator compensation would rise from $42,593 to $51,743.

According to the latest information from the Census Bureau (see http://www.census.gov/hhes/www/income/income05/statemhi2.html), the 2004-05 Two-Year-Average Median Household Income in Indiana was $43,091. Half the households in Indiana made more than $43,091, and half made less.

When evaluated from the standpoint of the state and local tax burden of Hoosier working families, our General Assembly legislators have not earned a salary increase that is 20% more than the median household income in Indiana. Per capita state spending the last 4 years has increased at a rate 42% greater than inflation. The 20% increase in the state sales tax 4 years ago was supposed to result in a 16.3% decrease in homeowner property taxes, but the outcome this year will be a 20.3% increase. There is a proliferation of unnecessary toll roads. A regional Family Meals Tax was imposed to build a new stadium for an NFL multimillionaire.

Our State Representatives should have amended SB 401 so their annual salary is the same as the latest Income of Households by State Using 2-Year-Average Medians from the Census Bureau (which can be accessed online at http://www.census.gov/hhes/www/income/statemedfaminc.html). Using today's median Indiana household income, state legislator salaries should increase from $11,600 to $43,091. Per diem pay should be entirely eliminated so the compensation of every General Assembly member is directly tied the welfare of Hoosier working families. If our state legislators want compensation greater then the median income of the ordinary working family, then they are nothing more than political hogs feeding at the public trough.

Listed next are how our state legislators voted on SB 401.

Taxpayer Friendly State Representative NO votes: Terri Austin, Dennis T. Avery, Jeb Bardon, Kreg Battles, Robert J. Bischoff, Bruce Borders, Jim Buck, Lawrence L. Buell, Mara Candelaria Reardon, David Cheatham, Bob Cherry, Suzanne Crouch, Bill Davis, Nancy Dembowski, Tom Dermody, Ryan Dvorak, Sean R. Eberhart, Jon Elrod, Craig R. Fry, Phil GiaQuinta, Terry Goodin, Tim Harris, Ron Herrell, Tom Knollman, Eric Allan Koch, Richard W. McClain, Joe Micon, Win Moses, Tim Neese, David L. Niezgodski, David Orentlicher, Phyllis J. Pond, Thomas E. Saunders, Ed Soliday, Steven R. Stemler, Amos Thomas, Jeff Thompson, Vern Tincher, Jackie Walorski.

Taxpayer UNfriendly State Representative YES votes: B. Patrick Bauer (cosponsor), Robert W. Behning, Matt Bell, Randy Borror, Brian C. Bosma (cosponsor), Charlie Brown, Timothy N. Brown, Woody Burton, Duane Cheney, William C. Cochran, William A. Crawford, Dave Crooks, John Day, Jerry L. Denbo, Mae Dickinson, Chester F. Dobis, Richard "Dick" Dodge, Cleo Duncan, Jeffrey K. Espich, Ralph M. Foley, William C. Friend, David N. Frizzell (cosponsor), F. Dale Grubb, Eric A. Gutwein, Earl L. Harris, Phillip D. Hinkle, Phil Hoy, Clyde Kersey, Sheila J. Klinker, Robert Kuzman (sponsor), Linda Lawson, Don Lehe, Dan Leonard, L. Jack Lutz, Carolene Mays, Cindy Noe, Dennie Oxley, Scott Pelath, Phil Pflum, Matt Pierce, Gregory W. Porter, Scott Reske, Kathy Kreag Richardson, Michael A. Ripley, Paul J. Robertson, William J. Ruppel, Milo Smith, Vernon G. Smith, Dan C. Stevenson, Russ Stilwell, Marlin Stutzman, Vanessa Summers, Gerald R. Torr, P. Eric Turner, Dennis Tyler, John D. Ulmer, Trent Van Haaften, Peggy Welch, Matt Whetstone, David A. Wolkins.

State Representative who DID NOT VOTE: Michael B. Murphy.

Taxpayer Friendly State Senator NO votes: Vaneta G. Becker, Mike Delph, Dennis K. Kruse, Patricia L. Miller, Ryan D. Mishler, Johnny Nugent, Brent Waltz, R. Michael Young, Joseph C. Zakas.

Taxpayer UNfriendly State Senator YES votes: Ronnie J. Alting, Phillip L. (Phil) Boots, Richard D. Bray, Jean Breaux, John E. Broden, Bob Deig, Gary Dillon (author), Jeff Drozda, Sue Errington, David C. Ford, Beverly J. Gard, Vic Heinold, Brandt Hershman, Glenn L. Howard, Lindel O. Hume, Robert N. Jackman, Luke Kenley, Timothy S. Lanane, Sue Landske, Connie Lawson, James Lewis, David C. Long (author), Teresa L. Lubbers, Robert L. Meeks, James W. Merritt Jr., Frank Mrvan, Allen E. Paul, Marvin D. Riegsecker, Earline S. Rogers (author), Vi Simpson, Connie W. Sipes, Tim Skinner, Samuel Smith Jr., Brent Steele, Karen Tallian, Greg Walker, John M. Waterman, Thomas K. Weatherwax, Richard D. Young (coauthor).

State Senators who DID NOT VOTE: Anita Bowser, Thomas J. Wyss.

This page was last updated on 03/25/10 .