By Bryan Corbin, Evansville Courier & Press
INDIANAPOLIS - With barely two months left to get something passed, Gov. Mitch Daniels again asked the Indiana General Assembly to approve his property tax restructuring plan, urging lawmakers to summon the same "bravery" they used to pass earlier reforms.
In his fourth State of the State address, Daniels struck a conciliatory note with lawmakers, praising them for getting an early start on hearing his proposal. But he asked them to tune out lobbyists and special interests he said are opposed to restructuring and focus instead on the plight of homeowners.
The first-term Republican governor spoke Tuesday night to a joint session of the Indiana House and the state Senate convened in the House chamber in a 25-minute address that was broadcast statewide and on the Internet. He was interrupted 20 times by applause.
"Some will say, how brave do you have to be to vote for a huge tax cut? But we all know how strong the pressure of special interests can be, how relentless the criticism, even from those with no plan of their own," Daniels told lawmakers. "So we know that our opportunity will not be seized without bravery."
Daniels reiterated the four main components of his plan:
Immediate tax relief to homeowners of approximately one-third. That would be achieved by partially replacing property tax revenue with a 1 cent increase in the sales tax to 7 percent; and by the state shifting child welfare costs and school-operating costs off of property taxes.
Permanent tax relief to homeowners through a state constitutional amendment that property taxes could not exceed 1 percent of a home's assessed value.
Reconfiguring the property-assessment system so county assessors take over the duties of township-level assessors.
Imposing limits on spending by local governments and schools, and allowing voters to decide large construction plans through referendums.
"I do not share the fear of some that Hoosiers cannot be trusted to weigh the pros and cons of big investments for which they will pay the costs. I say, trust the people; give them the facts and let them vote," the governor said from the House speaker's rostrum.
Daniels said that for every $1 of new sales tax consumers pay, his plan would deliver $1.19 in tax relief to homeowners the first year and $1.81 the second year.
In his speech, Daniels singled out one dignitary in the House gallery - former Gov. Otis "Doc" Bowen, architect of Indiana's 1973 property tax controls. Daniels urged lawmakers to pass the package in honor of Bowen in time for his 90th birthday on Feb. 26. The silver-haired former governor smiled and waved from the gallery.
Reaction from state lawmakers to Daniels' speech was generally favorable.
"I thought his speech was very positive; he outlined the foundation to begin with," said Sen. Vaneta Becker, R-Evansville. "Certainly, I think he recognizes there will be changes in his plan, but I think there's a lot of support for many of the initiatives he's outlined."
"I think the most important message he said was, we have to act together and work together and do this," added Rep. Trent Van Haaften, D-Mount Vernon. "I was a little surprised he didn't go into more detail on his plan; he narrowed it down to those four items. But in a sense, it helps, in terms of showing what he is indeed focusing on."
In the hallway outside the House chamber, a group of protesters who advocate total repeal of property taxes waved signs saying "Let Us Vote" and "Axe the Tax." In the past, Daniels has said he supports the "spirit" of the repeal advocates but that total property tax elimination is impractical.
Watching the State of the State speech on television from his home in Vanderburgh County, 69-year-old retiree Earl Robertson wished the governor had spoken on the repeal idea.
"If everything goes through like he's saying, that's going to be better than nothing," Robertson said. "As far as the people who want no tax, he didn't mention anything at all on that. I would have liked for him to have said something on that."
Daniels is up for re-election this fall, and with the political dynamic at work, the governor also briefly recapped what he considered some of the economic successes of his first three years in office.
He told lawmakers that his administration had balanced the state budget and recruited new industries, plant expansions and jobs to Indiana, to the extent that Indiana now has the lowest unemployment rate of the Midwestern states at 4.7 percent. He mentioned the new AT&T call center in Evansville.
Daniels also recalled the new state health insurance coverage for low-income Hoosiers and telecommunications reform that both passed with bipartisan support.
Those efforts, he said, have earned a positive reputation for Indiana nationally among businesses.
"Yes, we're becoming known. We're becoming distinctive," the governor contended.
Daniels light-heartedly warned lawmakers that if they don't pass property tax restructuring by their March 14 adjournment deadline, he will call them back into special session.
"We must all resolve to stay at it until success is achieved," the governor told the Legislature. "Please don't make spring break reservations without a refundable ticket, because we're all staying as long as it takes."