Kernan's speech omitted proposals

INDIANAPOLIS -- As it turns out, there was a lot more to Democratic Gov. Joe Kernan's legislative agenda than he laid out in his State of the State speech to lawmakers and the Hoosier public.

At least $2.1 billion worth of more.

Chances are, the three Kernan proposals that were hatched and found legs in the Democrat-led Indiana House will get cut down in the Republican-controlled Senate if they get there. If anything else, that chamber's leaders don't take kindly to ''got ya'' legislation.

Kernan, a Democrat running for a full term this year, had 30 minutes of free media to talk about his vision for moving Indiana forward. He had the command and respect of a joint session of the General Assembly for his Jan. 13 State of the State speech, and live TV broadcasts that reached most Hoosiers.

He talked about his prize proposal, expanding full-day kindergarten statewide. He talked about an ''on-call'' task force that child welfare caseworkers could call on if they were unsure about how to proceed.

He talked about Lt. Gov. Kathy Davis taking a fresh, new look at the entire structure of Indiana state government. The overview would lead to a more efficient, cheaper, more consumer-friendly state government.

He didn't say anything about some other proposals his administration was working on. But they are in legislative play now, and all three are about big money and carry lots of controversy.

One would prohibit companies from sheltering income from state taxes by sending royalty, interest and other payments to subsidiaries in other states such as Delaware and Nevada that do not collect income taxes. It closes other ''tax loopholes'' to big-business robbers, Kernan and House Democrats say.

''They got caught in a tax dodge, and instead of saying, 'OK, you caught me,' they're protesting, hiding with general inflammatory statements about tax increases, when in fact, there is no tax increase,'' said House Speaker Patrick Bauer, D-South Bend.

The Kernan administration has been working for weeks on this proposal, as evident by a Dec. 15 memo from the state Department of Revenue to state Budget Director Marilyn Schutlz. It suggests ways the state could take in tens and twenties of millions of dollars more in tax revenue.

Republicans call it all a tax increase on business at a time when Indiana is still suffering from losing 120,000 jobs, and tax revenues are trickling in below over-and-over-again, scaled-down projections.

The other two proposals Kernan did not mention in his State of the State speech would simply bring in $2.1 billion.

Kernan wants to sell off the state's future tobacco settlement payments for an upfront, $1.3 billion, and future federal highway allocations for $800 million. Both are big-time, big-money, big-borrowing proposals, but were not mentioned in his TV speech, when so many average Hoosier taxpayers might have been paying attention.

Kernan said there are a lot of details that go into proposals, and he can't lose sleep over when and how they are presented. The legislative process is transparent, he said, so there is always ample time to figure things out.

''There's no hidden agenda,'' he said. ''There's just a lot on our table.''

Not everyone is at the table all the time, however, and most Hoosiers outside the Statehouse didn't know these extra helpings were coming.


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