O'Bannon just can't get it right on the Build Indiana Fund

Scott Tibbs
Published by the Hoosier Project, 08-19-2001

O'Bannon just can't get it right on the Build Indiana Fund

In July, Indiana Governor Frank O'Bannon instituted "new" guidelines on the Build Indiana Fund, basically requiring that the State Legislature abide by the law regulating how money from the BIF is spent. But on August 17, O'Bannon backtracked on those guidelines, allowing volunteer fire departments to apply for BIF money without a government sponsor. O'Bannon had been under heavy pressure from both Republicans and Democrats in the legislature after he issued the guidelines.

It isn't surprising that state representatives and state senators would be critical of O'Bannon's action, given that the BIF is a pork-barrel project that is a major advantage to incumbents in elections every two or four years. But O'Bannon, after failing in his duty to make sure the funds were spent legally his first four years as governor, did the right thing in holding the legislature to the letter of the law. It's unfortunate that the Governor would bow to political pressure instead of standing on principle.

Officials in the O'Bannon administration also suggested that if not-for-profit groups cannot find a local sponsor perhaps state government will sponsor them. While this doesn't appear to specifically be in conflict with state law, it's an obvious attempt to make sure the pork barrel projects the BIF underwrites keep on going with as little friction as possible. Matt Brooks, executive director of the Indiana Association of Counties, said in the Indianapolis Star that it's very reasonable to wonder why the state would sponsor projects that local government would not. Brooks is right in raising this concern. After all, local government surely knows more about local not-for-profits than state government does and is in a much better position to make a decision about who should get the money than state government is.

The law governing the BIF says that only units of government may apply for grants, and that non-governmental organizations must apply for money through a unit of government. Volunteer fire departments fall into this category, but O'Bannon decided that avoiding political heat was more important than the rule of law in this case. Apparently, our Democratic Governor has learned well from the disgraced former leader of his party, William Jefferson Clinton.

But what was more amazing was the statement by Senator Vi Simpson of Bloomington. Simpson was quoted in the Indianapolis Star as saying that "This is so confusing that we want to concentrate on getting the money out to the people who deserve it, and then let's deal with all the legal issues later."

So, in other words, it is more important to keep the BIF gravy train rolling than to follow the law. It is highly irresponsible for a state senator to display such open contempt for the rule of law. It doesn't matter whether the law is "confusing" or not. The law should be followed. At least House Majority Leader Mark Kruzan (D-Bloomington) attempted to spin the grants as being legal with his weak argument that the state budget overrides all preexisting laws governing how the state is to spend its money. Simpson apparently doesn't even care that the law is being violated! This, in combination with the fact that State Representative Peggy Welch, also of Bloomington, didn't even know what the law was while she was distributing pork-barrel projects in her own district, shows that Monroe County isn't being represented well at all in Indianapolis.

Some of the rhetoric by the state legislators in the wake of this scandal is very much off target. Kruzan whined on AM 1370 that the Indianapolis Star has unfairly criticized not-for-profit groups, and that it was "unfortunate" that the Star would do such a thing. Kruzan, in attempting to make the Star look like the villain in this scandal, ignores an important fact. The blame doesn't lie with not-for-profit groups, but with the legislators who should have known the law and acted within its bounds. There has been some criticism of how not-for-profit groups have received grants for projects that were never built, or used the money for projects other than for what they said they would use it for. But the bulk of the criticism in this scandal has been directed at the state legislature, which is precisely where it should be. Kruzan's straw man does nothing to resolve the issue in front of us.

Indiana voters must wonder: where is Lieutenant Governor Joe Kernan, and what does he think about this controversy? Kernan is the Democratic Party's anointed candidate for 2004, and he should be making it clear now where he stands, while the issue is hot.

We have over a year before the 2002 elections, but hopefully the voters will remember how irresponsible state government has been with the money that they have been entrusted with. If responsible leaders in Indiana politics keep the pressure on, that will be more likely to happen. Who is ready to step up to the plate for fiscal responsibility and the rule of law?