Indiana State of the State Address 2001

Good evening, fellow Hoosiers, colleagues, and friends. Speaker Gregg, Senator Garton, Representative Bosma, Senator Young, Chief Justice Shepard and Chief Judge Sharpnack, thank you for hosting this joint session.

I want to thank my best friend, my wife, Judy, for all she does for me and for Indiana. And special thanks to my partner, Lieutenant Governor Joe Kernan. You've been a friend to me and all of Indiana, Joe. You've done an outstanding job, and I look forward to working with you over the next four years to keep Indiana in a State of Progress.

I sense tonight many of the same feelings of gratitude, privilege, humility and honor I felt when I first entered the Indiana Statehouse as a newly elected State Senator. And, I'm sure you have similar feelings.

As your governor, I am pleased to report tonight on the State of our State.

Indiana has had unprecedented economic growth and prosperity over the past decade. And we have responded in a strong and responsible manner.

In just the past four years we have invested record amounts in our public schools, our colleges and universities, and our roads and bridges. And, we have returned $1.5 Billion to Hoosier taxpayers.

We have managed the state's finances well. We are able to borrow at favorable interest rates because Wall Street has continuously given us higher credit ratings.

We have helped grow more than 150,000 new jobs, and we have among the lowest unemployment in the nation.

But now, the national economy is cooling down and so is Indiana's record growth. The growth of our state sales and income tax revenues has slowed. A new forecast projected that we will be $250 Million below our previous estimates for the fiscal year ending in June. This shortfall results in a compounded impact of $800 Million through the next biennium.

The beginning proposal that I presented to the Budget Committee is balanced and reflects our current economic situation. I have asked my legislative team to work with members of the House and Senate to pass a budget that is fiscally sound, balanced, and reflects my spending priorities. They are:

  • Continuing to improve our public schools

  • Supporting our most vulnerable Hoosiers

  • Making sure our working men and women have 21st Century skills; and

  • Continuing important state services.

    These are my spending priorities based on our available revenues. Because our economy is cooling down, our reserve is precariously low. Most of that reserve -- about $600 Million in the Rainy Day Fund and $265 Million in the Tuition Support Fund -- cannot be used unless certain conditions are met. That is why I am proposing that we use $410 Million of surplus gaming money to pay for some of these priority spending items and help us get through this economic slowdown.

    In the early 1990s, we used over $340 Million of lottery monies to help fund our schools tuition support program. So, there is legislative precedent for the temporary use of these funds for education.

    Our first challenge this year is to work within our budgetary constraints while focusing on our most important priorities.


    To do that, we need to start with education.

    I want to look back for a moment on where we started before addressing where we need to go. In 1996, Governor Bayh met with the nation's governors and business leaders at the National Education Summit.

    That summit launched a national commitment to standards-based education reform -- a commitment that we have honored here in Indiana. When I attended the same conference in 1999 with Superintendent Suellen Reed, the focus was on quality teaching and professional development.

    In talking with governors, business leaders, parents, teachers and administrators, it became clear that money spent is not the sole means to higher student achievement. Rather, focus, commitment, consensus, and cooperation are the essential ingredients of real reform.

    Thats why I asked Dr. Reed to join me in creating the Education Roundtable. The Roundtable brought together our business, education and community leaders in one room for a common goal: to improve Indiana's education. We asked all participants to check their politics at the door. And they did.

    The Roundtable first focused on essentials for higher student achievement: high standards, assessment and accountability. The result: Indiana now has one of the most comprehensive assessment and accountability systems in the nation. Plus, our new school accountability laws require schools to make continuous improvements while giving them the flexibility to determine how to meet their goals.

    But nothing has been more dramatic than the changes in standards that the Roundtable recommended and the Board of Education implemented.

    Before the creation of the Roundtable, experts characterized our standards as weak and confusing. In fact...before the Roundtable...the Fordham Foundation gave Indiana an F for English and a C for math. So, we worked together to rewrite those standards. The result: We now have some of the highest English and math standards in the nation. And the Fordham Foundation now gives Indiana standards an A for English, an A for math, and an A for science.

    Another independent national organization dedicated to improving schools had this to say about us: Indiana is leading the way to world-class standards and performance under the guidance of the Roundtable.

    Our greatest achievement the past four years has been changing the direction of our public schools. Clearly, Indiana's new student standards and accountability system are the biggest steps to school improvement since Governor Orr' s A-plus plan.

    These achievements would have not been possible without the stellar work of the Education Roundtable. So tonight, I invited each of them to join us so that we can all express our appreciation for their hard work. I would like to ask Dr. Reed and the members of the Education Roundtable to stand.

    Make no mistake. The Roundtable's work is not done. It is now helping re-write our geography, economics, civics and history standards so they too will be among the highest in the nation. And it is now focusing on quality teaching.

    While we have made progress by setting historic standards, we still have a long way to go. If we are to continue to improve our schools, we must enact additional legislation this session.

    We must invest in school readiness so our first graders can meet the highest English and math standards in the country. My $50 Million school readiness program offers flexibility for schools to meet local needs -- like full day kindergarten, moving the kindergarten entry date or programs like head start, or pre-school. Of course, no discussion on improving education is complete without a focus on reading. If our new English standards are to be successful, our children must learn to read at grade level by the third grade. Tonight I am asking you to support the most comprehensive reading and math initiative in Indiana history.

    My Ready to Read initiative includes funding for reading assessments, summer programs, reading institutes, and a tutor for every child struggling to read.

    Since our children will now be required to meet the highest math standards in the country, Algebra will be the key to their success. That's why I have proposed a middle school summer math program to expand learning time.

    But that's not all. Within this $50 Million initiative, we will also create 500 master reading and math teachers in the schools that need them the most. These master teachers will receive training over the summer and return to their schools to raise reading and math achievements. And the 50 schools that make the most improvement in reading and math will be rewarded.

    Our students must not only be good scholars but good citizens. That's why we need to support character education. Through our safe haven school program, character is being taught not only during school, but before and after school as well. Let's continue that progress by continuing to fund Indiana's Safe Haven schools.

    And now that we have raised our standards, we are turning our attention to professional development and to quality teaching. The Roundtable recognizes that our teachers need to be the best if our schools are to be the best. Tonight, I am proposing a $30 million quality teaching initiative. This program will fund professional development for teachers in the following areas:

  • Reading and Math achievement

  • Classroom management and discipline

  • National Board Certification

  • Character education.

    Friends, I want to make it clear how important this investment is to our children's success. We need a budget that pays for the professional development that our teachers need and that our children deserve. This should be a top legislative priority and we must fund this program.

    In recent years, we have given our schools greater flexibility to address their local needs. The time has come to expand that flexibility. Every session we get a little closer to passing charter school legislation. Let's pass a charter schools bill this session and get this job done.

    Last year, Indiana also took an important step in promoting lifelong learning and in re-training Hoosier workers by opening a Community College system. I urge you to support additional community college sites over the next biennium.

    We must also continue to support our great public universities so they can continue world-class research while also preparing students to compete in a global economy.


    I also ask you tonight to continue the success of the 21st Century Research and Technology Fund. We created the fund to stimulate economic development by supporting cutting edge research. And it's already doing just that. We've funded over 30 projects for private companies in partnership with our outstanding universities.

    All across Indiana, advances are being made in agricultural genomics, tissue engineering, engine design, high speed Internet video, and other important areas.

    Indiana is reaping the rewards of our investments, and we can't stop now. We need to reauthorize the 21st Century Research and Technology Fund and invest $50 Million in it over the next two years.

    I also encourage our public pension boards to invest a portion of their funds in private security equities to increase the return on their investment and spur growth in new companies. A very conservative estimate suggests just a two percent investment could result in $300 Million for new venture capital and other investment options.

    And, let's pass daylight saving time to help Indiana compete in the 21st Century economy.

    SKILLS 2016

    While we need to continue our support of high-tech companies, let's also address the needs of the many Hoosiers who work in manufacturing, health care and other sectors of our economy. Our Advance Indiana and Training 2000 programs provide support to Indiana companies to train workers in rapidly advancing technologies.

    These state training programs have helped over 700 Hoosier companies keep nearly 200,000 workers on the cutting edge of technologies. But we need to do more.

    Through the new Skills 2016 Program, we will take our state training programs to a new level and allow Hoosier workers to share in our plan to build a better Indiana.

    I appreciate your support of these initiatives. And I urge your passage of the 2016 Skills Program to help Hoosier workers.


    Just as our investments in Hoosier companies and workers have paid off, so have our infrastructure investments. Our Crossroads 2000 program was the largest single infrastructure investment in Indiana history. With your help, we've built and improved roads and bridges throughout the state of Indiana. And with an additional $310 Million in bonding capacity, we will continue this program through the biennium.


    With your support, we've also been able to enroll more than 150,000 children in Hoosier Healthwise, giving them access to health insurance. And, nearly 4,000 of our lowest income seniors are getting help with prescription drugs thanks to HoosierRx. And we expect 20,000 more seniors to be enrolled by the end of this year. I'm also convinced we made the right choice when we agreed to use virtually all of our tobacco settlement money for health initiatives. We must continue to fund these programs.

    And, I urge you to use a portion of those funds to help our most vulnerable citizens our developmentally and mentally disabled Hoosiers live new lives outside of institutions and reach their full potential.


    Another challenge ahead is complying with court-ordered reassessment. Our State Tax Board is putting together a rule that complies with the court order. This rule will be in place this spring. And, although the effect will not be felt immediately, once implemented it will have a dramatic impact on some households. So, we must put politics aside and work together on this issue for Hoosier homeowners, farmers and businesses. My Taxpayers' Protection Plan, which I proposed a year ago, should be considered in your deliberations.


    We've talked a lot about difficult choices tonight. But here's a choice that shouldn't be difficult at all: Let's give the Indiana Utility Regulatory Commission the power other states have and Indiana needs to impose fines or other sanctions against public utilities that don't give Indiana customers reliable service.

    Let's also give the IURC the authority it needs to review utility holding company mergers so it can better protect Hoosier ratepayers.


    Together, we have done much to build a better Indiana. Community service is part of our history as Hoosiers. I've seen it in every corner of the state. Volunteers, working together, to make their neighborhoods cleaner, safer and more civil. Private citizens, working together, to help build a new state museum because they understand the importance of respecting and cultivating our heritage. And, led by our First Lady, more than 160 millennium communities have implemented programs to meet goals by the year 2016 to build a better Indiana.

    We build a better Indiana:

  • When we protect our air and our drinking water, go after polluters and take care of our environment

  • When we pass legislation to lower the Blood Alcohol Content to .08

  • When we pass a constitutional curfew law

  • When we use tobacco settlement money to expand community care for our most vulnerable citizens

  • When we improve our CHOICE program for in-home care for our elderly

  • When we give Hoosiers safer working conditions, better workers' compensation, and meaningful unemployment benefits

  • When we support the Indiana Land Resource Council in preserving family farms, protecting open spaces and providing for continued economic growth

  • When we support existing Indiana businesses facing challenges, such as our steel industry

  • When we pass my school improvement plan

  • And when we establish lifelong learning as our standard for all Hoosiers.


    Last November, Hoosiers went to the polls and elected us to represent them. During the campaigns that led up to the election, we spent a lot of time talking -- often passionately -- about different issues. Now that the voters have spoken, we need to put partisan rancor behind us and take up the people's work. Hoosiers want cooperation, not conflict. They want action, not acrimony.

    At the end of the day, Hoosiers, not Democrats, Republicans, Independents, or Libertarians , but Hoosiers...must work together to build a better Indiana.

    The men and women who founded this great state in 1816 faced new challenges and adapted to change to build a better Indiana. So have we.

    Together, we have done much to make Indiana a better place to live and work. Tonight, I ask you to continue to put Indiana first as we all work together for a better Indiana.

    Thank you and good night.
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