Senate likely to revise House budget plan

State Sen. Lawrence Borst, R-Indianapolis, is perplexed.\nBorst, the chair of the Senate Finance Committee, is perplexed with House Democrats, whose $2.1 billion two-year budget passed the chamber 81-18 Monday. The House version of the budget would increase higher education spending by 3.8 percent over two years and K-12 education by 4 percent. It would spend $700 million more than the state is expected to bring in, according to state revenue projections.\nThe budget submitted to Borst's committee differs substantially from Gov. Frank O'Bannon's proposal, although both plans call for $2.1 billion in spending. \n"They're both in the same party," Borst said. "I guess they don't talk to each other."\nO'Bannon's budget placed more emphasis on Medicare and the state prison system, priorities Borst said he shares. With a slowing national economy and dwindling state revenue, O'Bannon had to make cuts elsewhere.\nAmong other things, O'Bannon's budget would have frozen higher education spending, meaning a tuition increase because of inevitable inflation. University officials expressed relief after the House version passed. \n"I would say the most recent budget passed by the House is a very positive development and welcome news," University spokeswoman Susan Dillman said. "A cautious budget estimate is certainly understandable. But it doesn't lessen the need. Investment in higher education is critical for the state's economy."\nThe House version allocates about $370 million to the Bloomington campus for the next two years, compared to $360 million during the 1999-2000 fiscal period. It also gives $4.5 million to the School of Informatics and $30 million in bonding authority for the Multidisciplinary Science Building. \nAccordingly, the House version scales back on many of the governor's priorities, including increased funding for the state correctional system.\nBorst, with a Republican-controlled Senate behind him, won't have it.\n"The governor set aside money for two new correctional facilities, and this only provides for one," he said. "There are many holes that need to be sewn up, and we'll take care of these things."\nIt's not Borst's most pressing concern with a budget that only allocates a 6-percent increase to Medicare, when the state has predicted a 7-percent increase. Medicare is an entitlement, and the state's payments are mandatory.\n"They're low-balling Medicare again," he said. "If the economy keeps going the way it's going, expenses will only increase. And when the bills come in, they have to be paid -- whether we have the money or not."\nAnd Borst said he doesn't want to see the property tax credit passed in 1999 scaled back, as it would be in the House version.\n"That's something we'd like to keep," he said. "We'll salvage it if we can. But the budget currently isn't sustainable. We'll try to be a little more responsible, a little more reasonable."\nBorst said he plans to trim spending, and he said higher education funding would likely be fair game. \n"We don't yet know where we'll make all the cuts," he said. "We're still doing some preliminary work. But higher education probably won't be flatlined."\nRep. Patrick Bauer, D-South Bend, authored the House version and defends the bill as "responsible" and "prudent." It has come under attack by some for drawing on gambling and tobacco settlement money, which they consider to be "risky" revenue streams.\n"We are still early in the process of negotiations on the budget bill," he said. "The Indiana Senate has yet to out its priorities. But I believe that the principles outlined in the bill -- as well as the fiscal restraint it demonstrates -- can serve as a guideline for legislators in reaching a final agreement."\nWhile the budget proposal enjoyed wide bipartisan support in the House, some Republicans withheld their support. Brent Steele, who represents the eastern part of Monroe County, didn't give it his assent.\n"We need to work together, especially in budget crunch," said Marty Wood, a Steele spokesman. "But if this passed overwhelmingly in the House and the Senate had to make revisions, they would have to answer questions"