Statehouse Report 1
January 7, 2009
LEGISLATIVE DEVELOPMENTS
Overview of 2009 Session of the Indiana General Assembly
The 2009 session of the General Assembly is a "long" or budget session during which the single requirement of the legislature is to pass a new biennial budget for the two-year period beginning on July 1, 2009. However, there could be more than 1,500 bills introduced covering a wide variety of topics.
During any long session, the General Assembly's top priority is passage of a biennial state budget bill. Unfortunately, the state's financial outlook is clouded by several factors. The state revenue forecast released in December projects that current fiscal year revenue will be more than $700 million less than forecast a year ago. As a result, the state is facing a current year budget deficit of more than $760 million. The new forecast also projects very slow revenue growth for the two years of the upcoming biennium, which begins on July 1, 2009. Finally, it remains unclear as to whether the economy has yet bottomed out or will get considerably worse.
Also compounding Indiana's financial condition, state government will be taking on additional budget responsibilities through takeover of several local property tax levies (schools and welfare) as a result of the property tax reform legislation passed by the General Assembly during its 2008 session. These additional expenditures are funded by an increase in the state sales tax rate from 6 percent to 7 percent however if sales tax collections continue to be below forecast, the additional revenue from the tax rate increase may fall short of meeting the state's increased spending.
IU Legislative Agenda
IU's operating budget and capital request will be the most important focus for IU's State Relations team. Our goal is to secure at least a minimal increase in IU's half-billion dollar operating appropriation to help pay for increased costs for salaries, energy, and health benefits.
The biennial budget bill usually also provides General Assembly authorization for the university to proceed with new facility construction projects. We have submitted requests for a number of important new facilities and major renovations of existing buildings at all of IU's campuses.
IU has submitted a joint request with Purdue University for state participation in an unprecedented major research collaboration in the biosciences. This initiative, the Indiana Innovation Alliance, represents the evolution of the life sciences initiative pursued by IU during the 2007 long legislative session that led to a $20 million appropriation for the Indiana Life Sciences Fund. The Innovation Alliance seeks to fund core research activities at IU and Purdue that have potential for economic benefit. This initiative also includes a request for funding to expand the number of students at the School of Medicine's eight regional Centers for Medical Education. The school plans to meet a looming shortage in doctors resulting from retirements by the baby boomer generation by increasing enrollment at the school's regional centers and by expanding programs from two to four years.
Tracking Legislation
As mentioned above, the long legislative session affords legislators an opportunity to address a wide variety of other issues besides the biennial budget. There will no doubt be a number of interesting issues, all of which will be reviewed by IU's State Relations team with assistance from a cadre of IU expert bill reviewers.
As always, the State Relations staff will provide regular updates during the legislative session (via our electronic Statehouse Report) as it proceeds to the end of April.
