[r72] A Clere view of the Statehouse: Jobs and education are the key (4/26/2010)

Monday, April 26, 2010

Start Date: 4/26/2010 All Day
End Date: 4/26/2010

Despite early predictions of a shorter-than-usual session, the Indiana legislature almost ran out the clock.

Sunday was the legal deadline for adjournment, and there's nothing like a hard deadline to drive compromise on difficult issues. Disagreement over a bill to delay an increase in unemployment insurance premiums was the sticking point. As soon as compromise on that issue was reached late Friday, everything else quickly fell into place. Final adjournment came moments before 1 a.m. Saturday.

In the end, the 116th Indiana General Assembly finished its work on a bipartisan note. It was a welcome end to what had been a highly partisan session. The hang-up over unemployment - UI for short - threatened not only prospects of a compromise on that issue, but also the fate of a bill to provide funding flexibility for public schools.

We could have accomplished much more, but I'm glad we at least ended up with a positive result on two of the most important issues - jobs and education.

Barring an emergency that necessitates a special session, the 116th Indiana General Assembly will not meet again. State representatives serve for two years, and state senators serve for four. All 100 House of Representatives seats and 25 of the 50 Senate seats are up for election in November.

When the newly elected 117th Indiana General Assembly convenes for organization day in November, it will include at least a dozen or so new faces.

The final days of the session included lots of goodbyes. Three long-serving members - two Democrats and a Republican - are retiring from the House. A first-term Democrat is retiring for health reasons. Three House members - a Democrat and two Republicans - are leaving the Indiana legislature to run for Congress. Sen. Connie Sipes, D-New Albany, is retiring, as is a Republican senator. A Democrat is leaving the Senate to run for a seat in the Indiana House. Two Republicans Senators who are not up for re-election this year are running for Congress - so they may or may not return to the Statehouse this fall.

In odd-numbered years, the Indiana legislature meets for a so-called long session, which starts in January and must adjourn by April 30. In even-numbered years, the session must end by March 14 and is referred to as the short session. It was expected to end even sooner this year, but that turned out to be wishful thinking or political posturing - or some of both.

The primary purpose of the long session is the crafting of the state's two-year budget. Last year's long session - my first session - was proof that a hard deadline doesn't always force agreement. The session ended without a budget, and Gov. Mitch Daniels called us back in June for a special session. We finally passed a budget June 30, the day before the start of the state's fiscal year.

Besides the budget, UI was the most contentious issue of last year's regular session. After much debate, the legislature passed a bill that would have increased UI premiums this year. I voted against it. Most of those who voted for the increase last year agreed this year that a delay was appropriate. Senate Bill 23 delays the increase for a year. It passed 50-0 in the Senate and 85-12 in the House.

Without SB 23, more than 80,000 Hoosier employers would have seen a $300 million tax increase next month. The increase would have caused additional job losses, and that's something we simply can't afford.

Indiana ran out of money to pay UI benefits in late 2008. Ever since then, we've been borrowing from the federal government to pay claims. Dozens of other states are in the same situation. That doesn't make it any better, but it does mean Indiana is in good company. Until the federal government decides how it is going to deal with UI borrowing, Indiana doesn't need to take the lead. Better to keep Hoosiers employed now and worry about settling up with the feds later. Still, the UI issue continues to loom, and we will have to address it.

In addition to delaying the UI premium increase, SB 23 also includes several provisions to promote job creation. A job retention tax credit that previously was available only to employers with at least 35 workers will now be available to all employers, which will benefit small businesses. SB 23 also includes a new tax credit for employers who create jobs.

A bill to provide funding flexibility for public schools was held hostage by the UI bill. The flexibility bill makes it easier for schools to access restricted funds and allows them to dig deeper into those funds. The benefit will vary depending on how much restricted cash local schools have on hand, but it will be a help everywhere. The bill, House Bill 1367, passed 97-0 in the House and 50-0 in the Senate.

I will devote future columns to further discussion of UI and education issues. In the meantime, I'm glad we walked away having accomplished something meaningful on both issues.

The session reflected the times - times are tough, and so was the session. Next year's budget will be even leaner than last year's; revenues are down even more, and there won't be any federal stimulus money. Still, if we continue to live within our means as a state and focus on jobs and education, we will emerge stronger. Better times might not arrive as soon as we would like, but they will arrive.