Evansville Courier & Press
Indiana Gov. Mitch Daniels has guts. In a state filled with Hoosiers who are conservative about their government and historically resistant to change, he is leading the charge for radical change in state government. He supports the widespread privatization of government services.
It's not all bad and not all good. His Major Moves initiative created billions for highway work, but his privatization of the welfare application process raised concerns about whether the state's most vulnerable citizens will fall between the computer cracks.
Yet, even before the protests about the welfare changes have died down, he is back at it again, taking privatization in still another direction.
On Thursday he proposed to lease the Hoosier Lottery to a private vendor and use the profits to fund higher education initiatives. His goal, he said, is to curb the state's "brain drain," which sees many of the Indiana's best and brightest going out of state for education and careers.
The governor proposed letting a private company operate the lottery and keep its profits. In return the company would pay Indiana $1 billion upfront, pay it another $200 million a year, and perhaps pay a share of the profits that go above an established amount.
The stated advantage of such a deal is that it would lock in a set amount for the state each year, instead of the state having to live or die with the fluctuations of lottery income.
Of course, the lottery does return a profit to the state. According to The Associated Press, Senate Appropriations Committee Chairman Robert Meeks, R-LaGrange, said the lottery brings the state about $200 million a year. That is currently spent on specific state programs, and helps explain the proposal for $200 million a year from the vendor - to continue that funding.
Of the $1 billion upfront payment, Daniels proposed that 60 percent would go toward the creation of Hoosier Hope Scholarships.
In exchange for the scholarships to Indiana colleges only, recipients would have to pay back the money unless they stay in Indiana to work for three years. The other 40 percent would be used to create the World-Class Scholars Fund. It would give public colleges and universities grants to help attract top researchers and faculty members.
The cause is right, but the challenge for the governor may be monumental. He will have to convince not only Hoosiers in general, but also a Legislature that may be less than agreeable, given some of the early reactions from lawmakers.
From our view, that's a positive. Unlike the welfare initiative, which the governor launched without legislative approval, he must go through the Indiana General Assembly if he is to change the lottery.
It would be a hard sell for him, but if the governor has the numbers to prove that it would be to the great advantage of Indiana to privatize its lottery, then he will have ample opportunity to make his case before the Legislature.