July 2, 2009

Dear Friends,

As you know by now, the General Assembly passed the biennial budget. For better or worse, we have a plan that will keep the state in operation for another two years.

In my view, the budget that was passed is worse than the version we considered in April. I voted against House Bill 1001ss because it fails to meet the goals I wanted from this session: protecting our schools, finding jobs for people at a time when more than 336,000 Hoosiers are out of work, and local economic development.

My decision to vote against the budget was not taken lightly. While the bill contained many good things, there were several issues that were so troubling that I could not support it in the end.

Here is a brief summary of the issues that caused me to vote against this budget:

K-12 School Funding

While this budget is very generous toward schools in suburban areas, it will be devastating for schools in urban and rural areas of Indiana. Selected Madison County school districts will lose significant dollars in their current budget year (2009) and in the two years ahead. Here is the final outcome for each school corporation in HD 36:

While I am pleased with Frankton-Lapel's school funding levels under HB1001ss, I represent each House District 36 school corporation equally and our non-growing schools suffered greatly.

The cuts in state support, particularly in the second year of the budget, will force these schools to eliminate programs and cut teachers. Worst of all, it will certainly increase class sizes and create a significant barrier to helping our children get the education they deserve.

The CIB Bailout

More than $275,000,000 in state income tax and sales tax was directed to the Capital Improvement Board over the next 35 years. The CIB will receive $24 million annually in state taxes for 35 years. The Board will also have the ability to borrow $9 million each year for the next three years from the State Treasurer. Repayment does not have to begin until after 2013. Anyone associated with the CIB openly stated that this plan is $11 million short of what they need. So, they'll be back. The CIB makes no contribution to the state's general fund as do other business and industry.

Other struggling areas of the state, Anderson and Shelbyville in particular, requested assistance from the Legislature for economic development projects, but Indianapolis was the only place to get this kind of special attention in the budget.

No Assistance for Anderson's Hoosier Park

Most disappointing to me was the fact that much-needed tax adjustments (deductions) for Hoosier Park and Indiana Downs were rejected in the final days of the special session. The proposed solution for these two entities had earned bi-partisan support in the House and had minimal fiscal impact to the state. Hoosier Park employs more than 1,000 people and contributes more than $60 million dollars each year to the state's general fund through wagering taxes. They provided more than $250 million dollars as a result of the licensing fee paid to the state to provide immediate property tax relief in 2007 and 2008. Yet, Senate Republicans and Governor Daniels refused to consider any type of adjustments that would allow them to stay viable and avoid bankruptcy. I guess they were too busy working on the CIB bailout.

Cuts To Higher Education Funding and Scholarship Assistance for Students

Funding levels for the Student Freedom of Choice grants (which are provided to students regardless of whether they attend public or private colleges and universities) was significantly reduced from the House proposal. In addition, state aid to higher education was cut by 2% across the board. As a result, students and their families will incur higher tuition and room and board costs. In addition, higher education institutions will be forced to reduce their financial aid awards.

One bright spot in this area was the $20 million in the budget for a new Ivy Tech campus in Anderson. The proposed campus expansion is much needed and will provide some jobs for those in the construction industry.

No Job Creation for Local Communities

The House proposal for local job creation through increased local road and public works funding was removed by the Senate leaders. This proposal passed the House on a bipartisan vote and would have brought more than $10 million dollars to Madison County cities and towns for sidewalks, road repair and new road construction.

I also must mention that this budget increases taxes for people on lower incomes because it eliminates the sales tax exemption they would receive for heating assistance in the winter.

I simply cannot justify a bailout for millionaires on the backs of our children's education, jobs for Hoosier men and women, and local economic development needs. For these reasons, it was clear to me that a nay vote was the right thing to do.

I did not want to see state government shut down. Passing a state budget before July 1 means our parks will stay open, police will continue to patrol our roads and your license branch stays open. But we could have done more to protect our schools, our workers and, quite frankly, everyone else in Indiana.

I also want to thank those of you who took the time to email me or respond to my special session survey over the past few weeks. It is always very helpful to have the thoughts and opinions of local constituents while I am representing you in Indianapolis.

Even though the 2009 session has come to a close, I still encourage you to contact me with questions and concerns. You can reach me by calling the toll-free Statehouse telephone number of 1-800-382-9842 , writing to me in care of the Indiana House of Representatives, 200 W. Washington St. , Indianapolis , IN 46204 , or submitting your comments to my web site at www.in.gov/H36. While visiting my web site, you also can sign up to receive regular e-mail updates from the Legislature.

Sincerely,

Terri