PDIF was created in 1937 to protect municipal deposits from potential failures of financial institutions holding public monies, similar to the FDIC that protects individual bank deposits.
In recent years PDIF became underfunded. The new legislation includes having the state repay a $50 million loan over 10 years and allowing the future earnings to stay in the fund.
This will ensure PDIF can adequately protect deposits now and in the future.
The ultimate benefactor is each and every taxpayer in Indiana as their dollars are better protected.
This new legislation will also decrease financial institutions' tax rate over the next four years. The decrease will put banks on the same tax level as corporations, allowing them to reinvest additional capital into their communities.
I commend the efforts of legislators in passing these much-needed revisions to ensure the health of Indiana, by protecting public funds and by strengthening banks' ability to invest in their communities.
James C. Marcuccilli, chairman, Indiana Bankers Association, president and chief executive officer, STAR Financial Bank, Fort Wayne