O'Bannon to announce deficit management plan today

All hope is not yet lost for lawmakers to reach a compromise on the budget crisis and tax restructuring. Almost two weeks after the regular session adjourned, Governor Frank O'Bannon and lawmakers will convene to continue working on Indiana's future. \nO'Bannon announced Wednesday that he will meet with legislators from the Democratic and Republican caucuses and fiscal directors April 9.\nThe meeting will focus on the Deficit-Management Plan that O'Bannon proposed to combat the state's growing financial crisis. \nO'Bannon said he will also determine the likelihood that the dissenting political parties will reach a compromise, warranting a special session of the General Assembly. \nHe will unveil the Deficit-Management Plan today at the Statehouse. It is a comprehensive strategy designed by the State Budget Agency.\nO'Bannon personally invited the representatives Tuesday and said he is encourage by lawmakers response. \n"Certainly nothing can be accomplished if we are unwilling to sit down together to discuss our viewpoints on these hugely important issues," O'Bannon said in a press release Wednesday.\nBrian Bosma, Republican leader form Marion County, thinks the meeting is overdue.\n"This is the first time this year leaders of the caucus and fiscal leaders have met together with the governor," said Bosma. "Better late than never." \nSome lawmakers say that the divide between the Democratic-controlled House and the Republican-controlled Senate is still too great. \n"I don't believe there will be a special session," said Republican Floor Leader Mike Smith, D-16. "We have a philosophical divide." District 16 includes Cass, Fulton, Jasper, Pulaski and White Counties.\nDemocratic Rep. Mark Kruzan, D-Bloomington, agreed.\n"A special session will be a waste of money unless the legislators involved agree on a compromise package to address the budget crisis prior to meeting," Kruzan said.\nWhen the General Assembly left the Statehouse March 14, lawmakers left many questions unanswered. The governor was unable to find support for House Bill 1004, O'Bannon's proposed budget deficit and tax reform plan. The tax system had not been restructured and the $1.3 billion shortage had no solution.\nO'Bannon began making cuts totaling $332 million, which he warned would be necessary if lawmakers could not balance the budget. Last week's cuts are on top of $782 million the governor cut from the annual state budget prior to the end of the session.\nThe bulk of the money comes from the Build Indiana Fund.\nThe BIF is an account created by lawmakers, which collects its resources from gambling revenue. The BIF then uses the revenue to fund organizations and programs such as the Monroe County Humane Association, Monroe County Recreation Department and WFHB.\nThe governor said the BIF and the projects it supports must be redirected into the General Fund if the state hopes to protect schools and state supported universities. \nThe budget cuts to public universities has IU officials considering a tuition hike.\nIU has already lost $100 million in the past two years, if withheld appropriations and budget cuts are combined.\nThe state provides IU with operating support, said William Stephan, vice president for public affairs and government relations at IU.\n"They keep our doors open and our lights on," Stephan said.\nStephan also said IU officials could decide if tuition will increase as soon as next week.\nFurther education cuts unlikely\nO'Bannon received good news today from Republican party. Connie Nass, the state's auditor, and Tim Berry, state treasurer, are two of three officials who make up the State Board of Finance. Berry and Nass must approve O'Bannon's proposal to redirect funds from the BIF. \nThe two fiscal leaders told the governor that adequate resources are available to pull the state out of the budget crisis without making further cuts to education, said Berry and Nass in a letter to O'Bannon Wednesday.\nO'Bannon will meet with Nass and Berry April 8 to make the proposed cuts official. \nMany lawmakers support O'Bannon's decision to cut the BIF budget. \nRep. Peggy Welch, D-Bloomington, said the governor is doing everything he can to protect education, but these programs benefit the citizens and local communities.\n"I regret the governor has to redirect the Build Indiana Funds," said Welch. "He is turning over every rock to try to raise money and lessen the pain."\nKruzan agreed and said the cut in programs will have a serious impact on communities.\n"Just ask the volunteer fire departments, homeless shelters and other community groups and it becomes clear the funds are not 'extras,' " Kruzan said.\nMost of the lawmakers agree that differing philosophies concerning Indiana's future was a factor in the failures of the last session.\n"Partisan politics played a huge role in the collapse of the session," Kruzan said.\nRepublicans and Democrats both think that the state must protect itself from future financial crisis. \n"I believe today what I believed years ago -- that the state should keep more in its reserves, called the Rainy Day Fund, to protect itself from budget deficits," Kruzan said.