MUNCIE – The 2021 state legislative session is remarkable for a series of bills that limit the existing power of Indianapolis city government. One of these would remove the control of the police department from the elected mayor and city council. Another removes the city’s legal authority to provide bus rapid transit, and yet another would prevent the city from regulating the placement of 5G wireless devices. The state legislature also appears poised to override Gov. Holcomb’s veto of a city ordinance that provided extra protections for tenants.

These are unusual issues for a state legislature to become involved in, but there’s more. One bill would prevent Indianapolis, or any other city, from changing its name. To be fair, that bill might be targeted at Russiaville, Toad Hop or Slab Town, not Indianapolis. Another would limit the powers of Indianapolis to undertake land-use authority within its city limits. A casual observer might conclude that some members of the General Assembly have abandoned federalism, that mainstay of conservative thought for the past 244 years. That couldn’t possibly be the explanation, though; it must be something else.

This flurry of legislation aimed at the heart of Indiana’s largest municipal government seems to signal that something unseemly is happening in Indianapolis. It implies that Indy is failing at something important, something at which the rest of Indiana is successful. Maybe, Indianapolis has a problem that is keeping it from attracting people, jobs or economic activity like the rest of the state. Surely that is the case? It must be that Indianapolis and the Indy metro region are doing so much worse than the rest of the state, that lawmakers feel compelled to intervene. Let’s see what the data says about that.

First, it is important to define the geographies. There is the City of Indianapolis proper, which is essentially Marion County. Then, there is the Indianapolis Metropolitan Statistical Area, which also consists of the surrounding counties. The legislation noted above would affect both the City of Indianapolis and the surrounding metropolitan area that depends upon the success of the city.

From 2000 to 2019, Indiana’s population grew by 639,000 persons. Within the Indianapolis metropolitan area, population grew by 543,000. So far this century, a full 85% of the state’s population growth happened within the Indianapolis metro area. Outside of the Indy metro, the state had just 96,000 new residents. By comparison, Marion County alone saw 104,000 new residents over the same time period.

Since 2000, the Indy metro area has grown by 35%, the City of Indianapolis by 12%, and the whole rest of the state by 2.1%. The City of Indianapolis saw more population growth this century than the 80 non-Indy metro counties combined. So, whatever concern about crime, zoning or building design residents have about Indy, they are worse everywhere else. Surely there is something else troubling the General Assembly for them to take such a keen interest in restricting Indianapolis government. What about jobs?

Since 2000, the Indianapolis metro region has added some 154,000 jobs. Of those jobs, the City of Indianapolis can account for 18,000 new jobs over the same time period. Here’s the rub; over the same time period, all the rest of Indiana lost a whopping 151,000 jobs. So far in this century, the Indianapolis region actually absorbed more than 100% of all the new jobs created in Indiana. So, if businesses have a problem with the way the Indy region is run, the problem is far, far, far worse in the other 80 counties.

Likewise, the Indianapolis Metropolitan Statistical Area has absorbed 65% of all the Gross Domestic Product growth this century. So far in the 21st Century, the City of Indianapolis alone received one out of every four new dollars of economic activity created statewide. Today, a worker in the City of Indianapolis produces $179 worth of goods and services for every $100 produced by a worker outside the Indy region.

The real shocker is that each year residents of Marion County send, on net, a bit more than $500 per person in tax revenues to residents of the rest of the state. All told, 20 Hoosier counties pay more taxes to the state than they receive in tax revenues from the state. Five of those are in the Indianapolis metro area. So, just to summarize it clearly, Indianapolis, and the Indianapolis region as a whole, are growing leaps and bounds faster than the rest of the state. At the same time, they bear a greater state tax burden, of which a significant share is sent to other counties. They get far less back in tax dollars than they spend.

This realization ought to prompt a bit of circumspection among Indiana’s lawmakers. It stands to reason that because Indianapolis is outperforming the state on growth in population, jobs, GDP and worker productivity, the remainder of the state ought to be taking notes. Instead, lawmakers are throwing roadblocks in front of this, and other cities. A modicum of wisdom would incline legislation toward more, rather than less, local autonomy.

Governing is hard work, and for serious people. One way to make mockery of the seriousness of those tasks is legislation that removes rental rules from city council, prohibits municipal governments from land use planning or, or keeps the good people of Mudsock or Gnaw Bone from changing their town’s name.

Households and businesses are voting with their feet. The City of Indianapolis is growing five times faster than the 80 non-Indy metro counties combined. For whatever flaws the city and region might have, the rest of Indiana would be better off economically if it were more like Indianapolis. 

The General Assembly should permit every one of our municipal governments more freedom to mimic the success of Indianapolis. And, if any member of the legislature still wants to decide how many two-way streets a city should have, to run a police force, or dictate how tall 5G towers must be, there is a quick and easy way to do so. Run for mayor. 

Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University.