03/27/2009 - Dems still want gov. to weigh in on unemployment (Associated Press)

Dems still want gov. to weigh in on unemployment

By Deanna Martin, Associated Press Writer

INDIANAPOLIS - Efforts to repair the state's bankrupt unemployment fund are in one of the last stops along the legislative path to become law -- but Democrats say it's not too late for Republican Gov. Mitch Daniels to come out with his own plan to fix the account.

"He's really been more than willing to give us input on lots of other issues like local government reform and the budget, but he's been nowhere to be found on unemployment insurance," said Senate Minority Leader Vi Simpson, D-Bloomington.

Indiana's unemployment insurance fund is paying out millions more in benefits than it collects in employer taxes, and the state has already borrowed $620 million from the federal government to keep issuing checks. A plan from the GOP-led Senate would help balance the account by reducing benefits for most people collecting unemployment -- something Democrats who control the House oppose.

A conference committee made up of Democrats and Republicans from the House and Senate could meet as early as next week to discuss unemployment insurance, said Rep. David Niezgodski, a Democrat from South Bend who will head the panel. Niezgodski said the governor should play a bigger role as lawmakers try to reach a compromise before the legislative session ends April 29.

"I think we would like to see a little bit more from him, and not just a friendly comment saying, "I think this makes sense,"' Niezgodski said.

Daniels says the unemployment insurance fund is a legislative issue, and he has not released any specific proposals on how he'd like to see the account balanced. But Daniels has said that the Senate proposal is an excellent effort that would begin to fix the system, said Jane Jankowski, the governor's spokeswoman.

Senate President Pro Tem David Long, R-Fort Wayne, said Daniels' administration has been involved in unemployment talks from the beginning, even if Daniels has not come out with his own plan. He suggested that it might be wise for Daniels to stand back from the issue as lawmakers start delicate negotiations.

"I appreciate the governor trying to let this sensitive issue move forward without his trying to weigh in too heavily on one side or another," Long said.

Long and others have said any compromise proposal will likely be a painful mix of increased taxes on employers, reduced benefits and stricter eligibility.

"This is not going to be a winner for anybody," Long said. "It's a miserable, difficult piece of legislation that has to get done. We're just going to have to find a way to do it."

The state's unemployment insurance fund wasn't always in trouble. In 2000, the fund had a surplus of $1.6 billion. But lawmakers raised benefit payments for the unemployed and lowered employer premiums, draining the account.

Indiana is one of 14 states borrowing money from the federal government to issue unemployment benefits.