Lawmakers returned to the Statehouse this week for the 2009 session of the Indiana General Assembly, which many believe will be one of the most challenging in decades.

We begin our work facing a national economic crisis that already has cost thousands of Hoosiers their jobs. These circumstances will affect almost everything we do in the months to come, but it will have a direct impact upon the one thing we must do in 2009: pass a biennial state budget.

Through these weekly reports, I hope to give you a chance to see the legislative process in action as we begin to take action on a number of initiatives, including efforts to create and retain jobs across Indiana, jumpstart the economy and protect against mortgage foreclosures.

This is the "long session" of the Legislature, which means we must finish our work by the end of April. Right now, members are busy filing bills for consideration in the House and talking to committee chairs to see if these proposals can receive a hearing in the weeks to come.

In the next few days, we will listen to the governor set his priorities for the session through his State of the State address and begin active deliberations on a new state budget. As Vice Chairman of the budget-writing Ways and Means Committee, we will start the arduous process of grilling agency heads about their budget requests. Earlier this week, the governor gave us an outline of what he would be requesting in the budget. His henchmen can expect some tough questions.

While budget talks always dominate a long legislative session, this year's work will be more difficult than ever since we will be operating under the burden of a national recession that has severely impacted our state's finances. State sales taxes, individual and corporate income taxes, and gaming dollars are closely tied to economic performance.

Given radical drop-offs in state revenue, the current budget now is operating at a deficit of more than $750 million. That's the difference between how much the budget proposes to spend on programs and agencies and how much the state is actually collecting in revenues.

In order to make up that deficit, the governor has ordered millions of dollars in spending cuts, which will affect the quality of services received by Hoosiers. Fiscal experts are forecasting that because of the current recession, the state cannot expect much in the way of additional revenue over the next year.

Where does that leave us in passing a new budget? If the numbers do not improve, there could be a deep impact on the education of our children, the affordability and availability of health care and the quality of police and fire protection across Indiana.

The governor's proposal this week gives some idea of the problems we face. He is calling for no funding increases for public education, cuts in higher education spending and significant reductions in funding for Medicaid.

At first glance, I am disappointed the governor's plan does nothing to address the massive job losses in our state over the past year. He also proposes to cut or even eliminate funding for some initiatives that could help put Hoosiers to work. After all, the budget dilemma is a symptom of our reeling economy.

I also am worried how education will fare in the new budget. Close to 60 percent of the budget goes toward public schools and universities, and the governor led the state to assume more of these obligations by eliminating the use of local property taxes for school general funds.

Unless there is a major upturn in the economy, the funding levels proposed by the governor will not allow schools to meet certain costs that are bound to go up, like utilities and insurance. Schools will be forced to contemplate cutting teachers. I do not see how this is in the best interests of our children.

The art of passing a budget is often described as a balancing act between providing the funding needed to maintain critical programs and the desire not to add to the burden of taxpayers at a time when the economy is tight. This year will provide a greater challenge than ever.

Remember that the state has cash reserves designed to protect programs and services during tight economic times. These "rainy day funds" contain millions of dollars--$400 million alone for schools--but the governor and others do not favor dipping into these cash surplus accounts. I anticipate much of our debate on the budget will focus on this issue.

There are other tests facing the Legislature, many created by the economic times we face.

Indiana's unemployment trust fund is broke at exactly the wrong time. While the federal government has provided a loan to shore up the fund, we must figure out a way to repay the millions we have borrowed and make the fund solvent again. The governor's budget proposal did even account for the interest payments owed to Washington.

Again, these choices are difficult. Do we increase the business taxes that provide the funding for unemployment insurance? During a national recession, do we cut benefits or change the rules to make fewer laid-off workers eligible for assistance?

A third issue generating public attention is the desire by the governor and some major special interests to change the way that government services are provided at the local level. In their most drastic forms, these proposals would get rid of township government, consolidate school districts across Indiana and place much of the control of county government in the hands of a single executive. Many elected offices would be eliminated, including county commissioners, auditors and treasurers.

This year, we will debate whether these changes provide the savings claimed by supporters, as well as whether such decisions should be made at the local level through referendums. Many question whether we need to be talking about proposals that reduce the level of services during times when people need help the most.

I will discuss these issues in more detail as they are debated at the Statehouse. As they do come up, I look forward to hearing how you feel about the budget, creating and protecting jobs and the way state and local government can help you.

If you need to reach me during session, you can call on the toll-free Statehouse telephone number of 1-800-382-9842, e-mail me at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or write to me in care of the Indiana House of Representatives, 200 W. Washington St., Indianapolis, IN 46204.