O'Bannon calls for compromise

INDIANAPOLIS -- In a Statehouse atrium filled with lobbyists and lawmakers, Gov. Frank O'Bannon made a late-session plea Wednesday for the General Assembly to balance the state's budget and restructure taxes.\nO'Bannon did not use the words tax increases, but he has repeatedly said they are necessary to shore up a projected $1.3 billion budget deficit and shield homeowners from much higher property tax bills expected under the pending reassessment.\n"Never before have Indiana lawmakers been given the opportunity to do so much and take such bold action…and make decisions that will make or break our state\'s progress in the short term as well as the long term," O'Bannon told members of a conference committee on tax and budget matters.\nO'Bannon has said that unless lawmakers raise some taxes to balance the budget, he will be forced to make major funding cuts in education and social services.\nHe couched such threats in calmer terms Wednesday by telling lawmakers to give "Hoosiers what they need to keep our schools on the great track they are on" and keep important services available.\nLawmakers face a March 14 regular session deadline to compromise on the budget and tax restructuring.\nWednesday marked the first conference committee meeting this session on budget issues, and for the first time in recent years, it was held in the spacious Statehouse atrium.\nOver the coming week, fiscal leaders will try to reconcile tax-and-budget plans passed by the Democrat-controlled House and Republican-ruled Senate.\nBoth would raise some taxes in order to cut property taxes and restructure business taxes. But the plan passed by the Senate would not use any revenue from tax increases to close the budget gap.\nRepublicans have insisted that O'Bannon, a Democrat, can manage the deficit on his own by making spending cuts, account transfers and tapping reserves.\n House Republicans, outnumbered 53-47 in that chamber, said Wednesday they were willing to step back some on that stand. They said if any final plan includes new tax revenue from gambling, they could accept it being used for the budget deficit.\n"It's time to compromise, quite frankly, and we have done that," said Rep. Jeff Espich of Uniondale, the fiscal leader for House Republicans.\nOn another front Wednesday, Republican state Auditor Connie Nass said her office had identified $278 million in various funds outside of the state's primary checking account that could be used to close the budget gap.