Statehouse Report 2
January 12, 2009
LEGISLATIVE DEVELOPMENTS
Gavel Opens New Legislative Year
The first week of the legislative session was dominated by the first step of biennial budget development process, approval of budget recommendations. Approximately 500 bills also were introduced.
State Budget Recommendations
On Thursday, the State Budget Committee voted 3-2 to accept budget recommendations prepared by the State Budget Agency. Typically, the appropriations included in the budget recommendations are incorporated into an introduced version of the state biennial budget bill. However, with two Democrats dissenting, it remains to be seen whether the introduced budget bill will deviate from the appropriations included in the recommendations.
Because of the state's projected revenue shortfall, the budget recommendations are the most austere in memory, incorporating unprecedented levels of state appropriation cuts. In addition to cuts already made to current year appropriations, many appropriations were recommended for further cuts in the new biennium.
This is unfortunately true for Indiana University as well. We have already been notified by the State Budget Agency that our FY 2008-09 operating appropriation will be cut by 1 percent and spending on facilities repair curtailed. For the first year of the upcoming biennium, the budget recommendations propose that state appropriations system-wide for IU be cut by $15.1 million or 3.1percent. In the second year of the biennium, IU system-wide recommended appropriations would be cut by another $1 million, or 0.2 percent. The State Budget Agency also recommended that there be a moratorium on new facilities projects, including those authorized in the current biennial budget that have not made it through the state approval process. Finally, while the administration has expressed support for IU's joint initiative with Purdue, the Indiana Innovation Alliance, no funding was recommended.
IU's State Relations Team will be working with legislators to inform them of the consequences of enacting a budget that incorporates appropriation cuts. It is important to remember that the budget recommendations are only the first step of a four-step process to enacting a state budget. The next step will be House passage of a budget in late February followed by Senate passage of its version of the budget in late March or early April. The final step is conference committee negotiations and final votes by both the House and Senate in the final days of the legislative session in late April. We will keep you informed of developments at each step of the process.
Introduced Legislation
Nearly 400 bills were introduced in the Senate and over 100 in the House during the first week of the legislative session. The State Relations staff is reviewing each introduced bill to assess whether there is a potential impact to IU. Many of these bills also are being reviewed by dozens of expert bill reviewers at IU. We will report further on some specific bills that we will be monitoring in next week's report.
Looking Forward to This Week
One of the major events of the legislative session is the Governor's annual State of the State address, which will take place on Tuesday, January 13. We expect that the Governor will spend a good deal of his speech on the state financial crisis and the biennial budget. The Governor will also likely discuss local government reform and express support for many of the recommendations included in the Kernan-Shepherd Commission, which was produced last year with staff assistance from IU's Center for Urban Policy and the Environment.
