Legislators debate a bill in the Indiana House chamber. Photo by Casey Smith, Indiana Capital Chronicle.

By Leslie Bonilla Muñiz
Indiana Capital Chronicle

INDIANAPOLIS — Indiana lawmakers have just a week to close a staggering $2 billion hole in the state’s next two-year spending plan. Indiana’s sobering fiscal outlook may soften the Senate’s traditionally hostile stance against a long-sought increase in the cigarette tax. But is it enough?

The current rate of 99.5 cents per pack has gone unchanged since 2007. A $2 increase could bring in $318 million in new revenue annually, and bring down the state’s high smoking rate.

“Our caucus was slightly more amenable to that than they have been in the past, primarily because of the challenge that Medicaid has created for us,” Senate President Pro Tem Rodric Bray said.

The House has voted to approve cigarette tax hikes multiple times but Bray indicated his caucus’ resistance hasn’t totally waned.

“That’s still on the table, but it’s not at all going to be the first thing we look at,” he said.

Sen. Shelli Yoder, his Democratic counterpart, additionally suggested pursuing a managed care assessment fee. If fully implemented, the fee could bring the state $1 billion a year.

“We should be doing this (to) our managed care entities, the insurance companies who are making money off of our Pathways (to Aging program) patients,” she said. “We should be looking there.”

Sen. Shelli Yoder, D-Bloomington, speaks on the Senate floor on Thursday, April 17. Photo by Whitney Downard, Indiana Capital Chronicle.

But it would require federal approval. Mitch Roob, who helms the agency overseeing Indiana’s Medicaid program, has expressed doubt that President Donald Trump’s administration would allow the Hoosier state to max it out.

And despite repeated assurances from leaders that “everything is on the table,” Huston was clear that one thing isn’t: marijuana legalization.

“We’re not going to legalize marijuana in the budget,” he said. He similarly batted away questions about gambling industry expansions.

“Significant public policy things shouldn’t be considered just because you have a revenue shortfall,” House Speaker Todd Huston told reporters.

Democrats, however, maintain conditions are ripe for a “serious conversation” about the drug.

Regulations for already-available, marijuana-like substances — and an accompanying excise tax — are still up for consideration, but face an uncertain path amid plenty of Senate skepticism.