Publius at Fort Wayne Politics has a post from a few days ago reporting that Dr. Tom Hayhurst, who looks to be the Democratic Challenger to incumbent Mark Souder for Indiana’s 3rd Congressional District, has raised $104,873 and has $87,648 on hand. By contrast, Rep. Souder has raised $71,119 and has $44,338.

As I read the post, Rep. Souder may file new numbers before January 31. At the very least, it appears clear that Dr. Hayhurst is a serious challenger.

The Governor has announced his intention to sell Indiana’s Toll Road to a foreign company for the next 75 years in exchange for $3.85 billion. Apparently this will pay for transportation construction for the next 10 years. What we do for the 65 years after that, I don’t know. Just poking around at the INDOT site, a trip along the length of the Indiana Toll Road costs a normal passenger vehicle $4.15. Under the proposed deal with the Spanish/Australian consortium, that toll will be raised to $8 through 2010. In 2010, the toll can be raised at least 8% and at least 2% per year after that. That means a toll of at least $35.25 by the time the lease expires.

I’m against selling off Indiana’s infrastructure. It’s just not a good idea to eat your seed corn. Mitch Daniels reminds me of one of those kids who gets set up with an annuity through a lawsuit from when they were a minor. They see an ad on daytime television from a company that will pay a lump sum purchase on the annuity. The kid is being ripped off, the company’s only paying 50% of what the annuity is worth, but he doesn’t care, he just wants a pocket full of money right now so he can buy that bitchin’ Camaro he’s had his eye on.

Another way to look at it, I suppose, is as an admission of failure by the Governor. He is telling us that this foreign consortium can achieve billions of dollars in efficiencies that his administration cannot manage. I figure there are three ways for this consortium to make money off of this: raise tolls, decrease maintenance, and increase efficiency. I haven’t heard the Governor talking about increased tolls or decreased maintenance, so he must think they can recoup their billions through efficiencies that he can’t.

(Of course, I think this is hogwash — I think the consortium will raise tolls beyond that which the State has the nerve to do directly and will skimp on maintenance. But the logical implication of what the Governor has said and what he hasn’t said leads to the conclusion that his administration does not have the competence to realize these billions without selling off our roads to foreigners.)

Update: Niki Kelly writing for the Fort Wayne Journal Gazette has a good article entitled “Toll Road bid $8.5 billion: Daniels pushes for quick action; others urge study”.

Critics point out that Daniels has had quite some time to craft his message on this; meanwhile, legislators are expected to digest not only the enacting legislation but also the 200+ pages of the contract and its associated schedules. They’re expected to do this quickly and to make a decision on whether to mortgage the Toll Road for the next 75 years as well as to whether to approve a bill that appears to have the effect of giving the Governor authority to mortgage much of the rest of Indiana’s transportation infrastructure.

Another item I noticed is that the foreign consortium who will be buying the Toll Road has relatively short concessions in the rest of the United States — 8 miles in Chicago, 4 miles in Detroit, 13.6 miles in Washington, D.C. The Toll Road runs the length of the state making it in excess, I believe of 150 miles.

I think an interesting figure to have would be to compare the dollars paid per mile per year. Assuming a 140 mile toll road at 75 years, the amount to be paid is about $362,000 per mile per year. By contrast, the 8 mile Chicago stretch was a $1.83 billion lease for 99 years which translates to $2.3 million per mile per year.

I couldn’t find information on the other holdings, but found this admittedly biased news release from a labor newspaper discussing labor issues involving the foreign consortium at the Detroit-Windsor tunnel.

On April 24, 29 Detroit-Windsor Tunnel workers were locked out of their jobs after refusing to accept a 3.5 percent wage reduction, a two-tier wage plan to drive wages down further and a $40 co-payment on prescriptions.

. . .

Macquarie Global Infrastructure Trust, an Australian financial institution, manages the tunnel for a huge profit. Their website boasts that operating costs (less than 15 percent) make up only a “small portion” of the overall costs that are offset by toll income that is expected to be increased. The trust fund suggests that the way they will make more profits is by stripping the tunnel of its financial assets and then selling it.

The Perry County News is reporting that the Perry County Board of Commissioners has enacted a “Certificate of Need” program for construction of new medical facilities. This is not a new idea. Counties who want to prevent competition to hospitals funded in part by the county have adopted ordinances prohibiting construction of new medical facilities until they have jumped through bureaucratic hoops and gotten the blessing of the County which is presumably doing the will of the hospital receiving the county funds.

What is confusing to me is the fact that the Perry County Board of Commissioners is adopting the ordinance now when a similar ordinance adopted by Morgan County was struck down by the United States District Court for the Southern District of Indiana. Morgan County has not appealed the court’s decision and so the court’s ruling is good law in the Southern District of Indiana. Perry County is in the Southern District. In the case of Sisters of St. Francis v. The Board of Commissioners of Morgan County (pdf) Judge Hamilton struck down the ordinance stating that, under Indiana’s Home Rule statute, counties do not have the power to adopt such ordinances because the power to regulate medical facilities has been preempted by the State. A copy of the Perry County ordinance is here, though I seem to have lost the last page.

The Perry County News story mentions the legal challenges:

Perry County is the sixth to enact requirements for certificates of need. Other counties that have adopted similar rules are Harrison, Floyd, Clark, Hancock and Morgan.

A federal judge recently struck down Morgan County’s ordinance and Perry County Attorney Chris Goffinet said he believed another legal challenge to a second county’s ordinance is under way.

The ordinance adopted Monday, Goffinet said, is different from others and was crafted “more narrowly” to make it less vulnerable to legal challenges.

However, the way I read the ordinance, it does nothing to overcome the basic fact that, under the Home Rule counties do not have the authority to engage in this sort of regulation. Judge Hamilton cited Indiana’s Home Rule statute (IC 36-1-3). The Home Rule basically starts with the presumption that a local unit of government has the authority to do something. However, it states that “Counties may not exercise powers that are expressly denied by a state statute or that are expressly granted to another entity.” It goes on to specifically withhold from counties the power to “regulate any conduct that is
regulated by a state agency, except that which is expressly granted by statute.”

The Court goes on to explicitly grant to the Indiana State Department of Health the right to license and regulate hospitals. The Court also indicated that there was no support for an inference that the General Assembly had given a county the power to hinder a county hospital’s competition. The Court went on to say:

Morgan County’s Ordinance in this case does not meet the standards of these Indiana decisions. The Ordinance serves a purpose of restricting competition, a purpose that is not merely different from the state regulations and policy, but is flatly contrary to the express state policy of promoting competition.

Among other things, the Perry County ordinance specifically attempts to regulate construction of new hospitals. As the Court in the Morgan County case noted, regulation of hospitals has already been specifically granted to the Indiana State Department of Health and, because of that, counties have no authority to engage in similar regulation. When I first heard about this issue, I thought maybe the Perry County Commissioners were simply ignorant of the existence of the Morgan County decision. But, from the news report, I see that they were aware of the decision but thought that the ordinance had been “narrowly drafted” to avoid the issues in the Morgan County case. After reading the Morgan County decision and the Perry County ordinance, that assertion is simply baffling. I propose that Perry County simply take the legal fees they will incur trying (and failing) to defend this ordinance and give them directly to the county hospital. Meanwhile, they can try allowing some competition in the health care industry in the county which will hopefully allow its citizens to get a better deal on their health care.

A couple of charming side notes to this story:

Monday’s meeting was the first time the ordinance was publicly discussed by commissioners or hospital officials in an open meeting, but [County Hospital CEO] Stuber confirmed that he recently met privately with commissioners to discuss the ordinance.

Also, with respect to the Morgan County case, the County was represented by attorney and state representative Ralph Foley. While attorney Foley was representing the County to defend the ordinance, Representative Foley was pushing HB 1494 which would have granted counties the right to adopt such an ordinance. As a run of the mill attorney, I just can’t compete with service like that. However, the bill did not pass the General Assembly.

As much of a political geek as I am, I just couldn’t bring myself to watch the State of the State tonight. It strikes me as basically a political infomercial, not so much conveying information as conveying the illusion of information. Typically I like reading reports on what politicians have done as opposed to reports on what they have said. This corresponds to my preference for reading the legislation they write and the contracts they have signed rather than hearing their speeches about what they intend to do or think they have done.

But then, I’m a collection attorney. I tend to just assume folks aren’t telling me the whole truth.

Update Apparently I’m not alone on feeling like political speeches aren’t necessarily to be treated as Gospel. Though, this statement by David Warrick that I received from Douglass Davidoff on behalf of the AFSCME is directed to Governor Daniels more specifically:

“Which lie do I start with?

“The governor says caseloads are going down. Our members report case loads are going up in social services. There are higher caseloads in welfare, including food stamps, temporary assistance to needy families and Medicaid. Child protection caseloads are about even. The citizens of Indiana are not getting good service from the governor’s management of social services.

“The governor says state government is more open. But decisions are being made behind closed doors. The decision to extend the management company’s contract at the Fort Wayne Developmental Center is an example of closed-door government. The administration’s shocking decision to close the Silvercrest child services center in Southern Indiana – the only facility of its kind in the state – was made behind closed doors. The Legislature created a citizens panel for Silvercrest that was available for consultation. No one from the administration asked to be heard.

“As for the state of the economy, the governor says a turnaround is in progress, But more Hoosiers were on unemployment. at the end of 2005 than a year earlier.

“In the whole state, in every department, state employees report things are worse than they ever were – with the singular exception of child protection. Judge James Payne’s management of that department should be praised as the exception to an otherwise bleak picture for state workers. They are hamstrung in their ability to provide services Indiana citizens expect.

“It is a coincidence worth noting that the governor’s speech came on the one-year anniversary of his decision to terminate collective bargaining for state employees.”

Representative Dvorak has introduced HB 1104 which requires a state or local government officeholder who is subject to a judgment of at least $15,000 for delinquent child support to be removed from office.

It’s always interesting when you can trace a piece of legislation back to a particular incident. This one appears to arise out of the story reported here by WNDU. In November, Roseland City Councilman David Snyder was found in contempt by a judge for violation of a child support order. Snyder was ordered to report commissions earned from his real estate business and to pay 30% of the earnings to his two children. Snyder did not correctly report his commissions to the court. In total, the arrearage was approximately $60,000. The November contempt order required Snyder to pay $11,000 within 45 days of the order or be put in jail.

The story mentions Prosecutor Mike Dvorak seeking to enforce the child support order. Mike is the father of Ryan, the state representative who introduced this bill.

Thanks to Paul for sending along this Survey USA poll on Gov. Daniels’ popularity. The regional break down is interesting. Gov. Daniels is somewhat liked in Indianapolis, but not so much anywhere else. His approve/disapprove numbers by region are, as follows: Indianapolis (50/45), Central Indiana (42/53), Northern Indiana (39/53), Southern Indiana (38/53).

Karen Francisco has a dim view of Governor Daniels in a column entitled Administration belies folksy campaign image. In it, she suggests that Daniels heavy handed ruling style is more in keeping with his corporate executive past than with the folksy, tenderloin-eating sales job he did with his “My Man Mitch” marketing campaign. She takes him to task for not being up front during the campaign about BMV closings, his indifference to environmental concerns (resulting in, for example, an attempt to bully Blackford County into rubber stamping a proposed confined-feeding operation), and his view of public education as nothing more than an unwanted budget item rather than a particularly important economic investment for Indiana.

She also devotes a fair amount of space to Gov. Daniels handling of Daylight Saving Time/Timezones:

Daylight-saving time is another example. During the campaign, I asked Daniels how he expected to accomplish what no other elected official had achieved. His reply was that he would take his case to the people, convincing them that it was in the state’s best economic interest to adopt it.

But that’s not how he went about it. Instead, he turned to some old-fashioned arm-twisting, wheeling and dealing. I think it’s hardly a coincidence that the wife of Rep. Troy Woodruff, who voted for daylight-saving time after insisting he never would, suddenly has a job with the Indiana Department of Transportation.

If the governor followed the course he had suggested, he would have learned what every legislator in Indiana already knew: It’s not about changing clocks twice a year. Not observing daylight-saving time was the compromise Hoosiers reached in the real battle over time zones. It wasn’t perfect, but it allowed both those who preferred Eastern time and those who wanted Central time to have their way for six months out of the year. Nullifying the compromise means that someone comes out the loser.

Earlier in the week, I mentioned Woody Burton’s “In God We Trust” License plate which passed the House Transportation Committee. On Monday, the Transportation Committee will consider House Bill 1150 which would allow a person registering an antique motor vehicle to display an authentic license plate or a reproduction of an authentic license plate from the vehicle’s model year on the antique motor vehicle.

I don’t have any particular problem with this license plate idea, but the amount of time the legislature spends on license plates is absurd. Like I said, we have more than 30 listed in the Indiana Code and I think there are a fair number of other plates issued under a BMV administrative procedure. Why don’t we just require every Hoosier to design their own individual license plate and be done with it. It’s government identification, not a fashion accessory.

Paul Musgrave has a post on a new accounting rule that could have a significant impact on state and local governments.

Under a new accounting rule, governments soon must start recognizing their long-term obligations to pay for retirees’ health benefits — and, for the first time, publicly disclose what it would cost each year to fund that liability.

PERF and TRF at least have long been underfunded. I don’t know how much of the shortfall is attributable to health benefits and how much is attributable to other things. Mr. Musgrave points to liability for lifetime health benefits for ex-legislators, a controversial plan (also see here.)

As for the consequences of the accounting change:

[t]he new rule doesn’t require governments to set aside any money to fund the long-term obligations — only to report what those obligations are.

But the change will shed new light on their long-term liabilities. And credit-ratings companies have told governments they expect the retiree health-care liability to be dealt with in some fashion. “We’re looking to see that governments don’t ignore it and look to control the growth of the obligation,” said Richard Raphael, an analyst with Fitch Ratings.

How the ratings agencies respond will have big consequences for local and state governments, which borrow heavily from the public markets and need to maintain good ratings to keep borrowing rates low.

The accounting change will affect most big governments starting in fiscal 2008, which generally begins on July 1, 2007. It stems from a rule passed last year by the Government Accounting Standards Board, the independent advisory board that sets accounting standards for state and local governments.

I wonder if this might have a side effect of making government keener to do what it can to control the spiralling costs of healthcare in the country. I don’t know what, exactly, can be done, but this will hit them where they live.