Daniels unveils 'ambitious' plan for next Indiana legislative session

INDIANAPOLIS — Indiana Gov. Mitch Daniels will propose some shared pain as a way to fix a $2 billion “imbalance” in the state’s unemployment insurance fund when lawmakers return to the Statehouse in January.

At a press conference Thursday to introduce his legislative priorities, Daniels said he wants to “tackle the imbalance” with a bill that would both raise unemployment premiums paid by businesses and cut benefits paid to the jobless.

“There are going to have to be changes in both directions,” he said.  

Fixing the state’s unemployment insurance fund is high on his list because of the big hole that exists. The fund was emptied out in 2008, and the state has been borrowing from the federal government ever since. The tab is expected to be up to $2 billion by year’s end.

Daniels’ proposed remedy for the broke fund was among the priorities he listed Thursday, two days after his Republican colleagues claimed major election victories that gave them control of both the state House and Senate.

Also on Daniels’ list: Balancing a budget with no tax increases; automatic refunds for taxpayers if state surpluses reach a certain level; reforming criminal sentencing to alleviate prison overcrowding; eliminating some parts of township and other local government; redistricting legislative districts fairly; and reforming public education with merit pay for teachers and more charter schools. He also said he wanted to find a way to entice high school students to finish their degree early, and give them the money the state would have otherwise spent on them to use for college or other post-secondary training.

Daniels described his list as “very ambitious.”

“It’s a big set of assignments,” he said.

Absent was any mention of social issues that have been raised by Republican state lawmakers in the past, such as the “defense of marriage” amendment that would ban same-sex marriage.

In what may have been a signal that education reform will receive his strongest support was the presence near the podium of Indiana Superintendent of Public Instruction Tony Bennett, a Republican elected to office in 2008. Bennett flanked one side of the governor during the press conference, while Lt. Gov. Becky Skillman flanked the other.

Bennett has been touring the state, talking to parents and teachers about proposals that would link teacher pay and tenure to student achievement. The proposals mirror those of the Democratic Obama administration, but on Thursday, House Minority Leader Patrick Bauer, a Democrat from South Bend, said he opposed the Obama plan for merit pay for teachers. Bauer said tying teacher pay to student test scores might subject students to abuse from teachers who might treat them as “meal tickets” to better pay.

Bauer also said he would oppose efforts to cut the amount of unemployment benefits paid to people who have lost their jobs. Bauer said he doubted if Daniels could deliver a balanced budget without raising taxes, given that the state faces a projected $1 billion deficit. “I think it’s magic if he can do it,” Bauer said.