Looking for a Lottery Rebound

Personally, I have nothing against the lottery. In fact, I joined co-workers back in the 1990s in one of those infamous "everybody throw a few dollars in and we’ll all retire early when we hit it big" plans, only to never, ever get close in several years of playing. We really only earned enough once in a while to buy more tickets. But then I guess that’s why they call it a game of chance.

The number of lottery games have seemingly multiplied at a rapid pace since then. But with the Great Recession of the last few years, and certainly a few other factors, far fewer lottery players have been taking their chances.

According to the National Conference of State Legislatures, lottery revenues declined in 25 states in fiscal year 2009. In addition, they were flat in 10 states and increased in only seven. Indiana had the dubious distinction of the biggest drop, with revenues going down 18.1%. Puerto Rico, Oregon and Arizona were the only others with double digit drops.

North Carolina, with a relatively new lottery, saw revenues increase 17.4%. Others on the positive side of the ledger: North Dakota, Iowa, Ohio, Kentucky, Louisiana and Minnesota.

Finally, the seven states that have not authorized lotteries: Alabama, Alaska, Hawaii, Mississippi, Nevada, Utah and Wyoming.

At one point, many in Indiana questioned whether the lottery was a good idea. That was before horse racing, riverboats, racinos and the like. The tax dollars generated by the gaming industry have become an essential part of the state budget. That’s the safest bet one can make.

Specter to Become a Spectator?

While Congressional races in Indiana drew attention two weeks ago, a brighter national spotlight is shining on Senate primary votes Tuesday in Pennsylvania, Arkansas and Kentucky. Part of the intrigue is whether a couple of Democratic incumbents will become lame ducks.

The focus is on senators Blanche Lincoln of Arkansas (challenged by Lt. Gov. Bill Halter) and Arlen Specter of Pennsylvania (facing Rep. Joe Sestak).

Runoffs are possible for both parties in Arkansas as a third candidate could keep Lincoln or Halter from getting 50% of the vote. On the Republican side, Rep. John Boozman is the favorite but there are eight other candidates on the ballot and he was polling below the 50% mark.

Those polls place Boozman ahead of both Democrats in general election matchups, but Lincoln has a huge advantage in cash on hand.

Specter’s much-publicized departure from the GOP came, at least in part, because he believed he wouldn’t win a primary battle against former Rep. Pat Toomey. Now he is in a close battle against Sestak, who has successfully used the message that he is the real Democrat in the race. The two Democrats and Toomey also have substanial bankrolls for the fall.

Kentucky features a pair of close battles. Ophthalmologist Rand Paul, a Tea Party favorite, is leading Republican establisment favorite Trey Grayson (current secretary of state). On the Democrat side, two current top state officials — Attorney General Jack Conway and Lt. Gov. Daniel Mongiardo, are in a dead heat.

Two incumbent primary victims thus far have been Sen. Bob. Bennett (R-Utah) and Rep. Alan Mollohan (D-West Virginia). I’ll take a guess that Specter might just joing them. Either way, Tuesday will be another lesson about the anti-incumbent mood among voters.

Kentuckiana Bridge Project Moving Forward

As southern Indiana continues to work toward enhancing its economy, one critical component is the Ohio River Bridges Project. The governors of Indiana and Kentucky announced Tuesday they are eager to continue the endeavor:

Governor Mitch Daniels, Kentucky Governor Steve Beshear and Louisville Mayor Jerry Abramson today convened the first meeting of the 14-member Indiana-Kentucky Bi-State Authority.

“It’s time to move, and in a way that creates a model on how two states can act together for the good of all,” said Daniels.

The Bi-State Authority was created to spearhead the project to construct two bridges over the Ohio River and to rebuild the Kennedy Interchange, where Interstates 64, 65 and 71 come together in downtown Louisville.

The authority’s mandate includes devising a financial plan for the project. The initial plan set the estimated cost at $4.1 billion. Indiana’s share is 30 percent.

“We’re taking a historic step today,” Gov. Beshear said. “The task before this authority is challenging but critically important. The work done here will benefit both of our states for generations to come.”

“It has taken many years, and lots of hard work, but we are now ready to move this important project forward,” Mayor Abramson said. “This authority will lay the groundwork for a vastly improved transportation system in Louisville and Southern Indiana.”

Beshear proposed the creation of special authorities to oversee development and financing of “mega” projects – those costing more than $500 million – between Kentucky and Indiana. The Kentucky General Assembly enacted the proposal in 2009. It created the statewide Kentucky Public Transportation Infrastructure Authority, which voted in October 2009 to recommend that Beshear, in cooperation with Daniels, create a bi-state authority for the Ohio River bridges project.

Legislature Shooting in the Dark on This One

Do you want the factual or the emotional arguments against what has become an unfortunate Indiana General Assembly tradition in recent years — consideration of legislation to allow guns to be brought into the workplace? The Senate actually passed such a bill in 2009 (by a 42-8 vote) and it returns this morning in the Senate Corrections, Criminal and Civil Matters Committee (in the form of SB 25).

Yes, individuals have a right to bear arms. But property owners certainly have the right — and obligation — to provide a safe workplace for their employees. The consequences are bad, often deadly, when guns and the workplace mix. Some of the facts that Chamber issue expert George Raymond will share in testimony:

  • October 2009 study by University of Pennsylvania researchers that shows people in possession of a firearm are almost 4.5 times more likely to be shot in an assault than people who are not in possession of a firearm. It cites a number of reasons why possessors of guns are in more, not less, danger.
  • A previous case study in North Carolina found that the "risk of a worker being killed at work was substantially higher in workplaces where employer policy allowed workers to keep guns … relative to those where all weapons were prohibited."
  • Texas, known for its straight and not-so-straight shooters, became one of the most recent states to "just say no" in 2009, rejecting bills that would have allowed guns in college classrooms and in cars in company parking lots.

If emotion is more your flavor, how about:

  • Last week’s St. Louis manufacturing company shooting that resulted in four deaths and five people being wounded.
  • The 2008 Henderson, Kentucky tragedy in which a disciplined worker retrieved a pistol from his car and proceeded to kill five people before shooting himself.
  • Two Northern Indiana incidents within four months of each other (in Goshen and South Bend in 2001 and 2002, which resulted in seven deaths and others being wounded).

Really, guns in the workplace? The goal should be to help Indiana companies and their employees prosper, not unnecessarily put them in the line of fire.

Single Legislative Body in Kentucky?

Forty-nine states do it one way — with two legislative entities (named the House and Senate in all cases, I’m presuming). Nebraska is the exception, with a single lawmaking body. Could Kentucky be the second to go that route? A state political leader said he is "intrigued" by the idea.

The Lexington Herald-Leader reported the following:

About half of the world’s sovereign states are unicameral, including the most populous — the People’s Republic of China — and the least populous — Vatican City.

House Speaker Greg Stumbo, D-Prestonsburg, said unicameralism is touted for saving money and working better in representation because it breaks the state down into equal districts with smaller constituencies — possibly 138 districts in Kentucky.

"This idea that there needs to be some overriding force to keep things in check, maybe as a country we have outgrown that," said Stumbo.

He said his staff has researched the issue and that such a move would require a change in the state Constitution approved by the legislature and Kentucky voters.

"I don’t know if the people of Kentucky would be interested in something like that or not, but I think it’s worth some debate at least," Stumbo said. "I’m intrigued by it. I don’t know if I’m for it, but it’s interesting."

Ohio Casinos Will Diminish Indiana Winnings

The fifth time was the charm for supporters of gaming in Ohio. Voters had rejected the approval of casinos in Ohio four times over the last couple decades, but apparently the Buckeye State’s fiscal concerns trumped the opposition as the referendum to allow land-based gambling operations in Cincinnati, Cleveland, Columbus and Toledo was approved with 53% of the vote in November’s election. Gaming in Ohio will certainly help that state with its revenue problems, but will just as certainly make Indiana’s fiscal picture worse by cutting into our gaming tax revenues.

Indiana currently receives about $250 million dollars a year from three riverboats that are within a short drive of Cincinnati. It is estimated that up to 38% of the riverboat patrons come from out of state. The Hollywood Casino in Lawrenceburg and Grand Victoria Casino & Resort in Rising Sun are just minutes from Cincinnati and could both be seriously impacted by a casino there. The Belterra Casino Resort & Spa in Vevay is a little further down the Ohio River, but likely would also feel the effects.

Additionally, the other casinos could draw away some of the traffic at the already greatly suffering Hoosier Park Racing & Casino in Anderson. All told, Indiana gaming tax revenues could drop by as much as $100 million. These likely future losses to Indiana follow the losses now being experienced at the Blue Chip Casino in Michigan City due to the opening of a new tribal casino last year just across the border in Michigan. In addition, Kentucky could well be the next state to siphon off revenues as the pressure mounts to allow slots at its horse tracks.

Bottom line: As more players enter the game, Indiana’s share of the winnings is sure to diminish.

Indiana Unemployment Rate Remains at 9.8%

From the Department of Workforce Development:

Indiana’s preliminary seasonally-adjusted unemployment rate showed little change in October, the Indiana Department of Workforce Development reported today.

Indiana’s preliminary rate of 9.8 percent marks an increase of 0.1 percent from a revised September rate of 9.7 percent (+0.1 percent). Indiana’s month-to-month change is considered statistically insignificant. The national unemployment rate increased in October 0.4 percent to 10.2 percent.

"Indiana’s unemployment rate has held relatively steady for the past three months despite a steadily climbing national rate," said Teresa Voors, Commissioner of the Indiana Department of Workforce Development. "However, a projected soft holiday retail season combined with a slump in manufacturing and hospitality employment tempers my optimism concerning the coming months."

Seasonally-adjusted total non-farm employment in Indiana declined by 1,600 in October. Indiana reported the largest employment declines in manufacturing (-5,000), mostly attributed to a slowdown in domestic automobile manufacturing following a temporary "Cash for Clunkers" spike, and leisure and hospitality (-5,900). Sectors reporting large job increases include: construction (4,000), professional and business services (2,200) and financial activities (2,200).

Indiana continues to report the lowest unemployment rate of its neighboring states. Illinois increased 0.5 percent to 11.0 percent. Ohio’s unemployment rate grew 0.4 percent to 10.5 percent. Kentucky increased 0.3 percent to 11.2 percent. Michigan decreased 0.2 percent to 15.1 percent.

Additionally, here is a county breakdown of unemployment figures.

Hat tip to Inside INdiana Business.

Budget Blues in the Bluegrass State

The Louisville Courier-Journal examines the monumental task the Kentucky legislature has before it as it attempts to cultivate a workable budget in next year’s session. When the word "bloodbath" pokes its head into an article about your economic situation, you know things aren’t good. Let’s hope our neighbors to the South can find a workable solution.

In recent years — as revenue failed to meet projections — Kentucky has used its Rainy Day fund and the stimulus money to avoid mass layoffs of state workers and deep funding cuts for its highest priorities, including the public schools.

But now the Rainy Day Fund is empty. And federal stimulus dollars are scheduled to run dry in the middle of the next fiscal year.

“It’s most definitely the worst budgetary outlook I’ve ever seen,” said State Budget Director Mary Lassiter, who has worked in the budget office for 27 years. “The outlook is a lot worse than it was two years ago.”

Lassiter’s boss, Gov. Steve Beshear, said the budget picture is “going to get more difficult because we’ve already cut out a lot of things that perhaps aren’t as essential as other things. You get down to bone at some point and cuts hurt.”

Budget process could be ‘bloodbath’

The stimulus funds, while welcome, merely delayed the day of reckoning for Kentucky.

Revenues to the state General Fund are projected to fall more than $1 billion short (about 12 percent) of the roughly $9 billion required in the 2009-10 budget as enacted by the 2008 General Assembly.

Beshear and lawmakers are using $787 million in stimulus dollars to help fill that hole.

But only about $485 million in stimulus funds will be available to Kentucky in 2010-11 — and none at all in 2011-12.

State tax revenues — which have shrunk the last two years — are expected to begin growing again next year, but not nearly fast enough to plug the gap when stimulus funds end.

Hoosier Issues in Kentucky Special Session

Indiana isn’t the only state reveling in the joys (insert your own joke here) of a special session – our neighbors to the south called back lawmakers for their own budget issue. Unlike Indiana, Kentucky is facing a nearly $1 billion budget shortfall.

While the race to finish a budget continues here, Kentucky legislators sent a revised plan to the governor on Wednesday (see story) . Several decisions being made in the Bluegrass state directly affect Hoosiers:

Legislation that would have allowed video slot machines at Kentucky horse tracks squeezed through the House, but failed in Senate committee this week (had this passed it would have meant fewer Kentuckians crossing state lines and less revenue for Indiana). This has been an ongoing debate in Kentucky, and this surely won’t be the last attempt by proponents.

Several years in the works, Kentucky finally has developed a funding plan for its share of the Ohio River Bridges Project, which would allow for two new bridges connecting the two states. (Read the 2005 BizVoice® story and the 2007 update.) Indiana plans to fund its portion of the project with Major Moves money. 

Now back to the countdown closer to home. We didn’t fare too poorly in Kentucky – we’ll see what happens here though.

States Seek to Batter(y) Up

The competition to be the leader in advanced battery technology is heating up. Indiana, with its recently announced Indiana Energy Systems Network, figures to be a player. The focus at this point is relying on the people and technology that have served the state well in the past in automotive and related industries.

Others are counting on splashier efforts. Texas is reportedly seeking $1 billion from the federal government to construct a lithium ion battery plant. In addition, two Indiana neighbors are also putting their hats in the battery ring.

Michigan is focused on automotive batteries, with various tax credits and incentives geared toward building four manufacturing facilities. Kentucky has a more broad based approach. The state, the universities of Kentucky and Louisville, and Argonne National Laboratory are developing a national research and development center in Lexington. In addition, the National Alliance for Advanced Transportation Batteries (affectionately known as NATTBatt), plans a research, battery plant and headquarters campus 45 miles south of Louisville.

The large scale manufacturing plants seem to be ahead of their time. While the Indiana plan may seem a little slower and safer from afar, it might well prove best in the long run. Wins along the way, such as the addition of Altairnano and its battery productuion efforts in Anderson, could lead to a major victory down the road.