The Herald Bulletin

Morning Update

Local Business

December 21, 2013

Alcohol tax hike may be tough to swallow

(Continued)

Local officials criticize the law as an unfunded mandate. It’s designed to encourage judges to sentence low-level offenders, whose crimes are often driven by addiction or mental illness, into community-based programs. But it came with no funding for those programs.

The working group – which includes the Indiana Prosecuting Attorneys Council, the Indiana Public Defender Council, the Sheriffs Association and state Department of Correction – found few treatment programs currently exist, especially for the poor.

Dave Powell of the prosecutors’ group and Larry Landis of the public defender council disagree on the impact of the criminal code reform; Powell worries some parts are too lenient, while Landis thinks some are too tough. But both agree that the law will fail if there’s no funding for local treatment programs that are at the heart of reducing recidivism.

The working group estimates a one-penny increase on the beer tax would raise $30 million in additional revenue. A nickel increase would raise $150 million.

The combined taxes on beer, wine and hard alcohol now raise about $45 million a year in revenue. Of that only 7 percent is set aside by the state to pay for mental health and addiction services. The rest is divvied up among the pension fund, a prison-building fund, and the state’s general fund.

Republican state Rep. Greg Steuerwald of Avon did much of the heavy lifting on reforming the criminal code and chaired the working group. He’s promised local officials that the law won’t shift costs from the state to the counties, as the Sheriffs Association and others fear.

But that means convincing legislators to come up with funding for locals to implement the law. One idea he’d like to consider, if they legislators are averse to raising the alcohol tax, is re-directing more of the current alcohol tax revenue into funding local treatment programs.

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