Governor Daniels wins budget standoff

Update from Hoosier Access Video



While democrats postured and tried to pull money from state reserve accounts, and Republicans postured to try and get cover going into the all important elections next year - Governor Daniels once again did what he does best. He led

He said early on that $1 billion must be left in reserves, and that no tax increases would be used.

He held to those convictions in the face of a storm of legislation and amendments to break those very principles. Kudos to leadership, when many states are groveling at the Federal cash window, Indiana is not.

The article from the Times spells out some of the issues that arise in NW Indiana from this budget and issues that will definitely have an affect on the coming elections:

INDIANAPOLIS | Indiana lawmakers departed the Capitol early Tuesday evening relieved they averted a state government shutdown with hours to spare, but few were happy with the two-year, $28.5 billion budget that Gov. Mitch Daniels promptly signed into law.

"If we don't vote to pass this budget, we are going to shut down this state, put people out of work," Sen. Luke Kenley, a top Republican negotiator, said after enduring two hours of complaints. "I'm going to ask you to vote 'yes' even though you hate this budget."

The spending plan, which also dangles a coveted bus and rail authority for Northwest Indiana, then cleared the GOP-ruled Senate on a 34-16 vote, with Sens. Frank Mrvan, D-Hammond, and Jim Arnold, D-LaPorte, providing half of the four Democratic votes.

Earlier, Rep. Mara Candelaria Reardon, D-Munster, was the lone region Democrat in the House -- among 14 statewide -- to back the budget as it cleared the Democratic-led chamber by a 62-37 margin. She and Mrvan pointed to the $14 million included to complete Little Calumet River levees, which is expected to be enough to finish the 28-year-old flood control project.

"How could I not support that?" Candelaria Reardon said of the levee funding. "My schools overall take some hits, but it could've been worse."

Statewide, schools are set to receive average funding increases of 1 percent next year and 0.3 percent in 2011. But the School City of East Chicago stands to lose about $3 million in state funding by June 2011 because of declining enrollment, while Gary schools face a $13 million loss over the biennium.

"Every time we deal with a budget, I'm up here with the same sad song about what we're doing to urban schools and most specifically Gary Community School Corp.," Rep. Vernon Smith, D-Gary, told colleagues during an 18-minute speech. "Most of you don't even care what you're doing to Gary, Indiana."

Rep. Charlie Brown, D-Gary, also opposed the budget but initially was listed as not voting, a problem he blamed on a malfunctioning voting button. "It wouldn't let me vote 'hell no,'" he said.

Sen. Earline Rogers, D-Gary, complained Republicans would not consider a land-based casino for her hometown, forcing her to settle for a summer study on gaming issues. Rogers said she considered printing T-shirts that read: "My legislator went to Indianapolis, and all she got back was a lousy study committee."

There was an anti-Indianapolis fervor amid the hours of floor debate, as lawmakers vilified the $8 million a year in state tax revenue the budget bill allows the capital city to siphon toward its deficit-ridden convention and stadiums authority.

Among the prizes secured for Northwest Indiana is a local income tax-backed transit district for Lake, Porter, LaPorte and St. Joseph counties that won't become a reality unless voters in at least two of those counties sign off on referenda scheduled for Nov. 3.

Kenley, R-Noblesville, said the referendum requirement represents a challenge to region politicians to prove public support for the transit authority. The district, to be overseen by region mayors and county officials, could impose a proportional income tax of up to 0.25 percent in each member county to create a regional bus system for Lake and Porter counties, fund South Shore operations and finance rail extensions to Lowell and Valparaiso.

Region lawmakers, particularly Reps. Chet Dobis, D-Merrillville, and Ed Soliday, R-Valparaiso, griped that the referendum requirement was added at the last minute without their consent.

Sen. Karen Tallian, D-Odgen Dunes, agreed the referenda will force four county election boards to spend "a pile of cash" on what could be a fool's errand. She also assailed another budget clause allowing the Porter County Council's decision to withdraw from the Northwest Indiana Regional Development Authority to be overridden by any two Porter County municipalities that wish to remain in the RDA -- at cost of $3.5 million a year to the county.

State Budget Details

Region stuff
-- $14 million to complete Little Calumet River levees
-- $3 million to begin planning work on a proposed $400 million teaching and trauma hospital for Gary
-- Allows voters in Lake, Porter, LaPorte and St. Joseph counties -- in Nov. 3 referenda -- to decide whether to create a regional transit authority that would impose a local income tax of up to 0.25 percent in each county to build commuter rail lines to Lowell and Valparaiso; create and fund a regional bus system for Lake and Porter counties; and take responsibility for funding operations of the South Shore commuter railroad, which runs from Chicago to South Bend.
-- Allows the Gary/Chicago International Airport board to privatize the facility through a lease running up to 99 years, with the profits to be sent to the city's general fund in installment payments.
-- Allows any two municipalities in Porter County to override the County Council's April vote to withdraw from the Northwest Indiana Regional Development Authority. If that happens, the county would have to continue $3.5 million RDA dues.

Budget basics
-- Spends $28.5 billion over two years: July 2009 to June 2011.
-- Maintains $1 billion in state reserves.
-- Incorporates federal stimulus money.
-- Republican Gov. Mitch Daniels signed it into law at 7:05 p.m. region time Tuesday.

"Like any compromise, this budget has its defects, but it meets the fundamental condition I laid down in January and every day since: to limit total spending enough to preserve our surplus and thereby protect taxpayers against the tax increases happening in virtually every other state," Daniels said in a statement.

Schools

-- Statewide, school districts get an average funding boost of 1 percent next year, 0.3 percent in 2010
-- "Trigger" would guarantee schools get half of all new money if the state revenues beat current projections for the next two years.
-- Gary Community School Corp. projected to see a 3.6 percent funding loss next year and another 4.1 percent drop in 2011 because of shrinking enrollment.
-- School City of East Chicago projected to see 2.4 percent funding loss next year and another 3.2 percent decline in 2011, also because of shrinking enrollment.
-- Creates a pilot program for a Web-based "virtual" charter school that can accept up to 200 students statewide next year and 500 in 2011.
-- Does not limit the establishment of new charter schools.
-- Allows charter schools to apply for state technology loans.
-- No longer requires charter schools to repay state for first-year start-up funds.
-- Allocates $2.5 million a year to fund private school scholarships that Hoosier can donate to on income tax returns.
-- Maintains funding for English-as-a-second language programs at $7 million a year.
-- Flat lines adult education funding at $14 million a year.

Higher education
-- Keeps university operating funding essentially flat, with federal stimulus money offsetting state cuts.
-- $30 million for student services building at Purdue University North Central.
-- $33 million to replace Tamarack Hall at Indiana University Northwest.
-- $20 million for construction at Ivy Tech Community College campus in Gary.

Other
-- Delays start of statewide property tax reassessment one year, to July 2010.
-- Lake County assessor must submit cost estimate and get County Council approval before appealing tax values the state places on region steel mills and BP Whiting Refinery.