News From Terre Haute, Indiana


January 18, 2014

MARK BENNETT: Young at heart

To grow, Indiana must offer an attractive future to the people it educates

TERRE HAUTE — Imagine an alternate ending to the old Life cereal commercial.

Two boys stare at a bowl of new-fangled, “good-for-you” cereal, refusing to taste it. They push it over to little Mikey, he tries a mouthful and then …

Spits it out.

“He hates it! Hey, Mikey!”

The result? Nobody would buy Life. Of course, the commercial would never air in such a case, but that’s not the point.

The point is, young people — given the freedom — tend to offer frank, blunt evaluations. Their elders realize that, but often suppress or ignore those observations.

The elder-filled Indiana Legislature needs to give the floor, ever so briefly, to a few Hoosier college seniors. The General Assembly leadership should find five such students who are just months away from graduating with degrees in science, technology, engineering or math. (Random seniors, not the student government reps or the presidents of the Young Republicans or Young Democrats.) Like that iconic bowl of Life cereal, push the microphone in front of the students and let them answer one question so important to the future of this state.

“Why do so many graduates of Indiana colleges and universities choose to leave this state to live and work elsewhere?”

Their responses would get at the heart of a proposal pushed last week by Rep. Scott Pelath, leader of the Democratic minority in the Indiana House. He wants to give tax breaks to the state’s top 1,000 graduates of Hoosier colleges and universities from the fields of science, technology, engineering and math. (The Indiana Commission for Higher Education would identify the top 1,000.)

The catch? The grads have to live and work in Indiana for five years. While doing so, those young folks would pay no state income taxes.

The Republicans who’ve run the Legislature and governorship for a decade equate tax cuts with economic growth. Indiana’s most valuable asset is its young people. Pelath paired those ingredients to create a plan to keep the brightest products of the state’s diverse and well-regarded institutions of higher learning. The bill’s concept should appeal to the Republicans who control the Statehouse.

“They believe taxation is important,” Pelath said, according to a Network Indiana report. “So let’s take that approach and apply it to something I think we all agree is a problem: After we pay for our kids’ college, are they going to stay here and live near us? I think that’s something we want, particularly when they’re stars academically.”

Initially, at least in public, House Speaker Brian Bosma seemed willing to “take a look at [Pelath’s] proposals” and “have a good discussion.”

They should talk, and then act.

And then go beyond that proposal.

Why? Refer back to the answers those five college seniors would give. Indiana needs a top-10-in-the-nation standard of living for its top-10-in-the-nation business atmosphere to matter. “Brain drain,” the out-migration of Hoosier college grads, depletes the chances for growth. The presence of talented, young graduates tends to raise incomes and life quality in a community. (Hoosiers’ average personal incomes are 10 percent less than those nationally. In Terre Haute, incomes are 30 percent lower.) They become volunteers, church members, scout leaders and youth league coaches.

The state-income tax break for those 1,000 smart degree holders, as Pelath put it, is just a start.

Indiana needs more than five years of state-income-tax freedom to reduce the loss of its college grads. (Approximately 1 of every 3 graduates of Indiana and Purdue universities remains in this state five years later, while 3 of 5 Indiana State and Ball State grads stay, according to the state’s Commission on Higher Ed.) Most carry heavy student-loan debts, averaging $27,886. Indiana should take a page from northern neighbor Michigan and offer to pay down the debts held by graduates while they live and work in state. A bill remains alive in the Michigan legislature that would offer a tax credit to cover up to half of an individual’s annual student-loan payments.

Or borrow a Kansas tactic. That farm state created “rural opportunity zones” in 50 sparsely populated counties to entice college grads to live and work in those locales. The incentives include $15,000 to repay college loans, coupled with a five-year state-income-tax waiver. Maine implemented tax credits to retain its graduates five years ago, though the state has failed to properly market it to the targeted audience. The city of Niagara Falls, N.Y., offers $3,500 in college loan repayments and low-priced homes to graduates willing to call the town “home.”

Getting them to stick around after the loans are paid is the larger problem for Indiana. It boils down to vibrancy. Great local schools. Safe, sharp-looking neighborhoods. Active downtowns. Homes that rise in value. Plenty of arts and cultural events.

Michael Hicks, director of the Center for Business and Economic Research at Ball State, cited those amenities in an essay last May. “The plain but disagreeable truth is that a majority of Indiana counties are not places where college grads, or young people in general, aspire to live. Employers know this, and so those who need these talented young people locate elsewhere.”

The proverbial Life cereal bowl is ours to fill.

Mark Bennett can be reached at 812-231-4377 or

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