Daniels supports stimulus plan

GREENFIELD, Ind. – Gov. Mitch Daniels said Tuesday he generally supports a federal stimulus package that would include some money for Indiana and other states, particularly for infrastructure projects such as highways and bridges.

Daniels was among about 40 governors who met with President-elect Barack Obama in Philadelphia to discuss the impact the faltering economy is having on states.

Obama told them he wants their help in designing a package to help states cope with the recession as part of an overall economic recovery plan that also would include tax cuts.

“I think (putting people to work) ought to be the touchstone, not to bail out states that spent more than they should have, and that clearly has gone on in many cases,” Daniels said after returning to Indiana Tuesday afternoon. “But if it particularly concentrates on infrastructure, then I think it has some potential to help, and we will clearly try to put it to good use in Indiana.”

Obama pledged a partnership with governors, Republicans and Democrats alike.
“As president, I’m not simply asking the nation’s governors to help implement our economic plan,” he said. “I’m going to be interested in you helping to draft and shape that economic plan.”

Indiana finished the fiscal year that ended June 30 taking in about $321 million more in revenue than it spent.

That figure would have been lower had spending restraints ordered by Daniels not resulted in $133 million in savings. Agencies were ordered to spend less, some projects were delayed and some employee vacancies were not filled.

State government ended the last year with nearly $600 million in its main checking account. That combined with savings accounts left the state with a budget surplus of about $1.4 billion.

But agencies have been ordered to curtail spending by 7 percent this fiscal year in hopes of maintaining a balanced budget.

Last week, Daniels asked the federal government for a loan of up to $330 million during the next three months to shore up the state’s unemployment fund. It has paid out $242 million more in claims this year than it collected in employer taxes.

The fund’s balance has steadily declined from $1.6 billion in 2000 to $21 million at a time when more than 75,000 Indiana residents are drawing unemployment benefits.
Recent preliminary figures by the U.S. Bureau of Labor Statistics put Indiana’s unemployment rate at 6.4 percent. It was the same rate in August – equaling the highest level since February 1987.

Indiana has lost 32,300 jobs this year, and there were 12,300 fewer jobs in October than in September.