Indianapolis Mayor Greg Ballard made his plea today before members of the budget conference committee for over $45 million in funding to rescue the city’s Capital Improvement Board (CIB).

According to Ballard, the CIB has a “three to four-year hump to get over.  We’re at risk until that point.”

At risk are major sports events such as the Big Ten basketball tournaments, the men’s NCAA Final Four, the 2012 Super Bowl and the convention center expansion.

Representative Terry Goodin (D-Austin) asked the mayor if his “proposal would take care of the board’s deficit or is it just another Band-Aid” – with more dollars needed down the road.  Ballard replied, “I feel pretty comfortable with this going forward…I don’t want to come back (for more money) – nobody wants us to come back.”

Ballard pointed out several times the connection of CIB activities to the entire state, referencing that the majority (60%) of traffic to the downtown sports facilities, Circle Centre mall, etc. is from out of town.

Though overall sympathetic to the mayor’s predicament, some registered displeasure that one area of the state would receive such significant financial attention.

Representative Bill Crawford (D-Indianapolis): “One of the caveats I’ve stated all along is that I support this, but by my own calculations, I can count only 21 legislators representing Marion County – and that’s a problem.  Other areas of the state have problems too.”

Crawford also encouraged his fellow legislators to keep the Indianapolis Indians baseball team in mind when looking at the mayor’s proposed increase in the admission tax, which he said could adversely affect the most affordable sports option for families,

Representatives Dennis Avery (D-Evansville) and Eric Turner (R-Marion) raised questions over Ballard’s proposed $2 million increase in the Professional Sports Development Area (PSDA) from $8 million to $10 million.  These additional funds would come to the CIB via the retention of more funds – as opposed to going into the state coffers.  These two legislators were concerned with how this would look to other cities like Fort Wayne and Evansville with professional sports teams but already receiving significantly less funding. 

Meanwhile, Rep. Jeff Espich (R-Uniondale) worried that helping the CIB “would open it up for others to try to fix gaming and other issues elsewhere ….we will be doomed if that happens.”

One voice of reason in all of this was Sen. Lindel Hume (D-Princeton), who seemed to be tired of hearing that no one outside of Marion County truly cared about the CIB funding woes. 

“I live in rural Princeton and I care.  The CIB represents a significant investment in future revenue for Indiana,” he notes.  “If we don’t do something, Circle Centre (mall) will close; we will lose dollars.  If we don’t do something, the conventions will leave; we will lose dollars.  This is as important as a large manufacturer to the state.”

But perhaps Rep. Cherrish Pryor (D-Indianapolis) made the best case for providing the CIB with the requested money.  “The state receives a much greater amount in return – roughly half a billion dollars – than what CIB is asking us for.”

It would appear then that some common ground must be reached and CIB funding included in the state budget, despite the shortness of time. (Crawford noted a bill must be printed by Sunday to present to the House.)

Education funding is always a contentious issue at the Statehouse, but the battle is rising to a new level this time around (as we have heard over and over and over). Past disagreements largely centered on the level of spending increases. With fewer dollars available, it’s a case of where are they going to go — to students or districts.

The budget is filled with education measures beyond the funding fight. One issue thankfully not on the table, at least for now, is minimizing the 180-day school year. Chamber education expert Derek Redelman reported it this way following the end of the regular session.

In recent months, we have heard from a new president, from a new secretary of education, from a film comparing Carmel students to those in India and China (see here) and from multiple other sources that American students spent far too little time in school. So it was a bit shocking to see at least six different bills filed this year that would have allowed Indiana’s school year to be shortened.

The Chamber fought these bills vigourously and most never even got a hearing. The one bill that did get a hearing was talked about by House Education Chairman Greg Porter (D-Indianapolis), who acknowledged that a reduced school year would be most harmful to the low-income students he represents.

Things all changed when Superintendent of Public Instruction Tony Bennett announced mid-session that the Indiana Department of Education would enforce current law and would no longer allow schools to count parent-teacher conferences and professional development days as student instructional time. He also announced much less flexibility in the waiver of inclement weather days. It was a decision backed by 20 years of Indiana law and one the Indiana Chamber applauded loudly, but it was also widely criticized by House Democrats, who vowed to block it through legislation. Though Rep. Porter offered the legislation intended to accomplish that goal, it ultimately failed.

How much of the stimulus money had been injected into the economy through the first 4½ months of the year? As of mid-May, about 6% of the money — $45.6 billion – had been paid out. Much of that went to Medicaid costs, unemployment benefits and the $250 checks to Social Security recipients. Highway projects had received $11 million. The Transportation Department had committed an equivalent amount, but the money has not gone out yet.

In all, some $88 billion had been committed to various types of projects and programs. The administration points out that it is a two-year program, but many state officials and others remain anxious. The administration has committed to spending 70% of the money, or $550.9 billion, within the first two years.

Vice President Joe Biden said in an interview recently, "I think that what you’re going to see happen here is the velocity of this will increase not just arithmetically, but geometrically here. At least, we’ve got to make that happen."

The Wall Street Journal takes a look at the proposed cap and trade legislation, which could get a vote as early as Friday. Many are still worried that if this measure does stop global warming, it may do so by freezing the wallets of American businesses and consumers in the process:

Despite House Energy and Commerce Chairman Henry Waxman’s many payoffs to Members, rural and Blue Dog Democrats remain wary of voting for a bill that will impose crushing costs on their home-district businesses and consumers. The leadership’s solution to this problem is to simply claim the bill defies the laws of economics.

Their gambit got a boost this week, when the Congressional Budget Office did an analysis of what has come to be known as the Waxman-Markey bill. According to the CBO, the climate legislation would cost the average household only $175 a year by 2020. Edward Markey, Mr. Waxman’s co-author, instantly set to crowing that the cost of upending the entire energy economy would be no more than a postage stamp a day for the average household. Amazing. A closer look at the CBO analysis finds that it contains so many caveats as to render it useless.

For starters, the CBO estimate is a one-year snapshot of taxes that will extend to infinity. Under a cap-and-trade system, government sets a cap on the total amount of carbon that can be emitted nationally; companies then buy or sell permits to emit CO2. The cap gets cranked down over time to reduce total carbon emissions.

To get support for his bill, Mr. Waxman was forced to water down the cap in early years to please rural Democrats, and then severely ratchet it up in later years to please liberal Democrats. The CBO’s analysis looks solely at the year 2020, before most of the tough restrictions kick in. As the cap is tightened and companies are stripped of initial opportunities to "offset" their emissions, the price of permits will skyrocket beyond the CBO estimate of $28 per ton of carbon. The corporate costs of buying these expensive permits will be passed to consumers.

The biggest doozy in the CBO analysis was its extraordinary decision to look only at the day-to-day costs of operating a trading program, rather than the wider consequences energy restriction would have on the economy. The CBO acknowledges this in a footnote: "The resource cost does not indicate the potential decrease in gross domestic product (GDP) that could result from the cap."

The hit to GDP is the real threat in this bill. The whole point of cap and trade is to hike the price of electricity and gas so that Americans will use less. These higher prices will show up not just in electricity bills or at the gas station but in every manufactured good, from food to cars. Consumers will cut back on spending, which in turn will cut back on production, which results in fewer jobs created or higher unemployment. Some companies will instead move their operations overseas, with the same result.

The Chicago Tribune also chimed in today, noting the bill has grown from 900 to over 1,200 pages in a matter of a couple days. Due to the added girth, do you think legislators actually know what they’re voting on at this point? Probably should considering the magnitude and implications this would impose. (Hat tip to our federal legislative guru Cam Carter for passing this story along.)

Money money money money MONEY. Some people got to have it.
 
For Democrats working on the state budget, that last lyric has been amended to: Some districts got to have it.   
 
The D’s are pushing hard to protect K-12 school funding for districts rather than students. In other words, enrollment numbers be damned; urban districts, which have historically received higher funding levels than others, should stay that way regardless!
 
Thanks to items called the “minimum guarantee” and the “deghoster,” declining districts like Indianapolis Public Schools (IPS) have continued year after year to receive annual funding increases – even as enrollment levels have declined dramatically. Today, most of these urban districts get far more funding per student than rural or suburban schools. 
 
The Indiana Chamber’s education expert, Derek Redelman, notes that the state currently provides IPS with over $8,500 per student – far more than the $6,500 state average. When federal funds are included, the total for IPS rises to more than $9,400 per student, while the state average is just over $6,700. The numbers are even higher – over $15,000 for IPS – when local property taxes are included.
 
Yet, IPS Superintendent Eugene White today (one of a seemingly endless stream of testifiers, most of whom can now venture to the Statehouse committee rooms in their sleep) came before the budget conference committee with his hands out for more. Despite fewer and fewer students and additional increases in per pupil funding, White contends the money IPS gets from the state is still not enough. 
 
White had no answer for Rep. Brandt Hershman (R-Monticello) when asked what districts should be cut to give IPS more money or whether he would support a tax increase to give his district more money. 

According to Redelman, “This is the epicenter of our current budget debate. Democrats firmly back districts while Republicans want to fund students.”
 
Just how wide is the gap?
 
After it was noted that IPS funding would take a cut under the Senate budget bill (though it would get one of the largest increases per pupil) while the growing Hamilton Southeastern district would see an increase (but a cut on a per pupil basis), Rep. Bill Crawford (D-Indianapolis) imparted this bit of logic:

“We (the Democrats) are looking for a way to make K-12 education (funding) more equitable. If we have to bring the top (funded schools in the Senate plan) down to bring the bottom up, I’m for it.”

Indiana isn’t the only state reveling in the joys (insert your own joke here) of a special session – our neighbors to the south called back lawmakers for their own budget issue. Unlike Indiana, Kentucky is facing a nearly $1 billion budget shortfall.

While the race to finish a budget continues here, Kentucky legislators sent a revised plan to the governor on Wednesday (see story) . Several decisions being made in the Bluegrass state directly affect Hoosiers:

Legislation that would have allowed video slot machines at Kentucky horse tracks squeezed through the House, but failed in Senate committee this week (had this passed it would have meant fewer Kentuckians crossing state lines and less revenue for Indiana). This has been an ongoing debate in Kentucky, and this surely won’t be the last attempt by proponents.

Several years in the works, Kentucky finally has developed a funding plan for its share of the Ohio River Bridges Project, which would allow for two new bridges connecting the two states. (Read the 2005 BizVoice® story and the 2007 update.) Indiana plans to fund its portion of the project with Major Moves money. 

Now back to the countdown closer to home. We didn’t fare too poorly in Kentucky – we’ll see what happens here though.

Well, we’ve complimented South Carolina Governor Mark Sanford’s more sound and judicious moves on this blog in the past. Now, suffice it to say, "sound" and "judicious" might not be applicable for him this week (although we all have our bad weeks).

However, Ragan.com took a look today at how his disappearance — which ultimately led to the disclosure of his affair — could serve as a lesson for CEOs in the business world. Read on:

To paraphrase Simon and Garfunkel: Where have you gone, Mark Sanford?

For the past few days, journalists, politicians, South Carolinians, bloggers, and your wife wondered about your whereabouts. First, we heard you were hiking the Appalachian Trail.

Well, not so much.

It turns out that you were in Argentina visiting a woman with whom you’ve been having an affair. (That’s a whole other domestic communication quandary.)

The issue for corporate communicators is this: Let’s say your CEO leaves unexpectedly—doesn’t even send a postcard. How do you communicate the message to your employees and other stakeholders?

Dustin R. Walling, principal of Dustin Walling Associates, shares these four tips on dealing with a missing or ailing CEO.

Business as near-usual: Every good corporation of size has—or ought to have—a well-conceived set of strategic and tactical plans. This is one of the primary jobs of the CEO and the executive team. If these plans don’t exist, hire a management consultant and get to work.

Appoint the next in command: The COO, CFO, or another key executive is the likely candidate to stand in during the CEO’s absence. The board should meet immediately and appoint one executive, a member of their own ranks, or another trusted leader to the position. Read the rest of this entry »