Budget Fails To Pass Before Deadline, Assembly Goes Into Overtime

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(STATEHOUSE) - Legislators face their first special session in six years, after failing to pass a budget by their midnight deadline.

Ten minutes before the deadline, the Senate approved a spending plan on a bipartisan vote. But about half the House Democrats joined all House Republicans in rejecting it.

Ways and Means Vice Chairman Scott Pelath (D-Michigan City), one of two House Democrats on the negotiating committee, accuses Republican Governor Mitch Daniels of negotiating in bad faith, demanding another $100 million in cuts to shore up state reserves after House Democrats and Senate Republicans had already reached an agreement in principle.

Pelath and other Democrats complain the budget would have left schools underfunded. Senate Appropriations Chairman Luke Kenley (R-Noblesville) warns a special-session budget is likely to be even leaner, as revenue numbers continue to show the state falling short of expectations.

Daniels issued a written statement saying he would have vetoed the budget anyway. A spokeswoman says Daniels will have more to say today.

It's up to Daniels to decide when to call the special session, but a budget must be in place by the June 30, end of the fiscal year, to avoid a government shutdown.

The Senate vote was 37-13 in favor, with 27 Republicans and 10 democrats voting yes while seven Democrats and six Republicans voted no.

The House rejected the budget 71-27, with 24 Democrats joining all Republicans in voting it down. House Democrats adjourned the session minutes later.

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