Pence Proposes 10% Cut In Indiana's Income Tax Rate

Republican gubernatorial candidate Mike Pence announced his first major state finance proposal today. He wants to cut the individual income tax rate by 10%, providing the largest income tax cut in Indiana history. Pence would reduce the individual income tax rate from 3.4% to 3.06%. The average family of four would save about $228 a year in taxes. A small business owner with a net income of $300,000 would save about $1,000 a year.

"The time has come to cut taxes for every Hoosier, in the city, in the factory and on the farm," said Pence. "We will make Indiana the most attractive place in the Midwest to start a business, grow a business, or get a job."   

"I believe strongly that when government has too much money, it needs to return that money to taxpayers who first earned it," said Pence. "Thanks to Governor Daniels, we are in such a positive fiscal condition that we can afford to do that on a permanent basis."

Pence says that the tax cut would reduce state revenues by about $533 million a year, but he says Indiana would benefit from having the lowest effective tax burden in the Midwest. Even with the tax cut, Pence says that he believes tax revenues will exceed expenditures by a little more than a billion dollars over the next two years. Indiana's current budget surplus is about $2 billion if you discount the fact that the state's public pension systems are grossly underfunded and the more than $2 billion the state borrowed from the federal government after the state's unemployment insurance trust fund went broke at the beginning of the recession that started in 2008. Current Indiana law already requires the state to refund to taxpayers half the surplus in excess of 12.5% of appropriations and half of that amount to paying down the state's unfunded pension liability.

Pence's Democratic opponent, John Gregg, welcomed Pence to the tax-cutting argument that he has already put forward. Gregg earlier proposed the elimination of the sales tax on gasoline, which he says would save the average family between $261 and $522 annually, and result in a loss of state revenues of about $540 million. Gregg told the Star's Mary Beth Schneider that his tax cut plan was "more significant" than Pence's tax cut plan.

I'm all in favor of keeping taxes as low as possible, but I wonder how wise Pence's and Gregg's tax cut proposals are at this time. The surplus can disappear just as quickly as it appeared if the recession takes a double dip as it appears it may, and the surplus really just exists on paper by excluding the state's outstanding obligations. Gov. Daniels will also have spent all of the money realized from the leasing of the state's toll road by the end of his term and the state will face difficult challenges in keeping up with its transportation needs.

Lugar Buries The Hatchet With Mourdock

The National Republican Senatorial Committee tells the Politico's Scott Wong that Sen. Richard Lugar has buried the hatchet with Indiana State Treasurer Richard Mourdock, who defeated him in the May primary when he sought re-election to an unprecedented seventh term after a hard-fought, often bitter race. When Sen. Lugar learned that Mourdock would be speaking at the Committee's luncheon in Washington today, he asked to be afforded the opportunity to introduce Mourdock. Sen John Cornyn, the Committee's Chairman, said that Mourdock returned the favor to Lugar by "praising Lugar's life-time of public service to Indiana and the country." Mourdock was seated between Lugar and Sen. Dan Coats during the luncheon according to Wong. "Lugar was 'incredibly, incredibly gracious,' Mourdock told reporters upon leaving the lunch." “It was a very important symbol of how we’ve come together to support a Republican running for office,” Coats told POLITICO. “I’ve gotten the sense that Senator Lugar has reached out to him in friendship, and Richard has acknowledged receipt of that, and I’m very pleased with what took place today.”

Double-Digit Pay Raises For Ballard's Staff Now Drawing Media Scrutiny

Several stories hit the mainstream media this afternoon questioning why Mayor Greg Ballard handed out double-digit pay raises to top members of his staff at the same time city agency heads are being asked to identify cuts in their budgets to help close a budget deficit that may be as high as $50-60 million. Ballard provided salary increases of at least $20,000 for his chief of staff and two deputy mayors after he decided earlier this year to pay a new deputy mayor of education a salary of $120,000. Other staff members received raises as high as 31%. In all, 14 members of Ballard's staff shared in large pay raises this spring according to the Star's Jon Murray.

Fourteen staffers — about half the staff in Ballard’s 25th floor offices in the City-County Building — shared in large raises in May and June, from support staffers up to deputy mayors. The average boost among those employees was nearly 18 percent . . .

I think it's absolutely obscene,” said Councilwoman Angela Mansfield, a Democrat who chairs the Administration and Finance Committee. “I keep coming to the word obscene over and over again. When you’ve got situations like (shortfalls in) Animal Care and Control, which has been underfunded again and again ..... to give somebody a raise from $98,000 to $120,000, it’s just obscene.”

That nearly 23 percent boost was given to deputy mayors Olgen Williams and Michael Huber to match the $120,000 salary paid to Ballard’s new deputy mayor for education, Jason Kloth, who was hired in the spring.

New Chief of Staff Ryan Vaughn, the former Republican council president, also makes $120,000. His predecessor, Chris Cotterill, was paid $97,850.

Overall, Ballard signed off on pay increases amounting to $149,010. The largest percentage raise — 30.8 percent — went to Deputy Chief of Staff Amy Waggoner. An executive assistant received a 6.2 percent raise, the smallest bump.

Mayor Ballard did not respond to the complaints about the pay raises. He left that to his press secretary, Marc Lotter, who also received a big pay raise bumping his annual salary to $105,000. Lotter defended the raises by claiming that the higher salaries are being absorbed within the mayor's current budget by not filling vacant positions on the mayor's staff, which became very bloated during Ballard's first term in office. One of the positions that isn't being filled is a director of Latino Affairs position previously held by Carlos May, who left the mayor's staff recently to campaign full-time for the 7th District congressional seat he is seeking that is currently held by U.S. Rep. Andre Carson.

Councilor Angela Mansfield, who chairs the Administration and Finance Committee, told the IBJ's Kathleen McLaughlin that she first learned of the staff raises after reading about it on Advance Indiana. Mansfield told McLaughlin that she didn't think the mayor's decision to boost the pay for his deputy mayor of education should have been used as an excuse for raising the salaries of other senior staff members given the current financial difficulties the city is facing. Councilor Mary Moriarty Adams tells Fox 59's Russ McQuaid that she expects that all city agencies will have to make cuts to close the major budget deficit the city is facing. McQuaid reported that one of the proposals being considered by the administration is to ask the FOP to open up contract negotiations to reduce a 3% pay raise that police officers are scheduled to receive under their contract. This comes as the administration announced that it plans to keep Public Safety Director Frank Straub on for an extended period. Straub had been expected to leave his current position at the end of July after he announced his planned exit to avoid a no-confidence vote planned by the city council a few months ago.

Media Searches For New False Narrative As Old Obama Narrative Collapses

Several new books by reputable authors have completely shattered the false biographical narrative Barack Obama constructed in his autobiography, "Dreams From My Father." As Joel Gilbert releases his latest documentary, "Dreams From My Real Father," attempts are being made by the mainstream media to find an ancestral link between Obama and an African slave. Since they couldn't find a link on his supposed father's side, they are now claiming that one of his white mother's ancestors was actually an African slave. To accept this narrative, you have to believe that one of Dunham's ancestors named "John Bunch" is the son of "John Punch," an African-American slave. This appears to be just another diversion to avoid broaching the compelling case Joel Gilbert makes that Barack Obama, Sr. was not Obama's biological father. Gilbert pieces together a lot of circumstantial evidence that points to Frank Marshall Davis, a prominent member of the American Communist Party with strong ties to the former Soviet Union. Obama's white grandfather, Stanley Dunham, took Obama to visit Davis at least once a week while he was living with his grandparents in Hawaii at the instructions of his mother. Obama bares no family resemblance to his claimed Kenyan father while he bares a striking resemblance to Davis. Below is a trailer to Gilbert's documentary. You can also view an interview Gilbert gave to Alex Jones explaining how he reached his conclusion that Obama's real father is Davis here. This offers an explanation for the various anomalies concerning the Hawaiian birth certificate, why there exists no record of a marriage between Dunham and Obama, why immigration officials believed there was no bona fide marriage between Dunham and Obama and why so many of Obama's childhood photos are photoshopped. The Kenyan father narrative was all made up.

Public Safety Cuts Loom As City's Budget Problems Worsen

It's difficult to figure out the exact size of Indianapolis' budget deficits. Various local news sources are reporting varying deficit sizes in the tens of millions of dollars, running as high as $60 million. Some mention a shortfall in the city's current budget, while others focus on the deficit faced in next year's budget. What appears certain is that there will be cuts made in the police and fire department budgets, even if the City continues to give away massive amounts of money to developers who contribute to the mayor's campaign committee and the CIB prepares to give tens of millions of dollars more to billionaire Herb Simon to subsidize the operations of his Indiana Pacers. And there will inevitably be more cuts in basic services like parks and libraries. Despite the hottest summer in many years, IndyParks is preparing to close its pools earlier than ever according to WTHR.

It is absolutely astonishing how the city could be contemplating deeps cuts in basic city services but continues to spend on non-essential services as if there are no budgetary concerns. The administration continues to pressure the city council to approve yet another TIF district expansion to include all of the booming areas of Mass Avenue, a move that will divert property tax dollars that would have otherwise gone to pay for schools, parks, police, fire and library services. This is only needed so the mayor can offer more public subsidies to private developers who contribute to his campaign. There was absolutely no scrutiny given to the $6.5 million Mayor Ballard gave to one of his largest campaign contributors, Ersal Ozdemir, to build a new parking garage with new retail space that will exclusively benefit Ozdemir. We now know that the rosy fiscal picture painted in the mayor's re-election campaign was total fiction. There was no honestly balanced, and it is clear that public safety is not job one for the mayor. I wouldn't be surprised at all if his next move is to propose yet another tax increase ala Bart Peterson despite his campaign promises to the contrary. And I'm still waiting for someone in the mainstream media to ask questions about why Ballard handed out double-digit pay raises to members of his staff while the city is in the midst of a budget crisis.

Ballard's Top Staffers Received Up To 31% Pay Raises

Despite a large budget deficit the City of Indianapolis is facing, Mayor Greg Ballard handed out pay raises as high as 31% for top members of his staff. According to radio talk show host Amos Brown, Ballard gave $22,000 annual pay raises to his chief of staff and two deputy mayors, in addition to smaller pay raises handed out to other members of his staff. Chief of Staff Ryan Vaughn and Deputy Mayors Mike Huber and Olgen Williams saw their annual pay raised from $98,000 to $120,000 to match the pay Ballard gave to his new deputy mayor of education, Jason Kloth. Other members of Ballard's staff received raises ranging from $3,000 to $20,000 according to Brown. On an annualized basis, Brown estimates that the cost of paying Ballard's staff jumped 32.7%. The IBJ reported that the administration is expected to unveil its 2013 budget proposal with an anticipated $27 million budget deficit.

Brickyard 400 Attendance Down Again This Year

Attendance at all NASCAR events has been declining for the past four years, but it has been particularly noticeable at the Brickyard 400 run at the Indianapolis Motor Speedway. NASCAR officials estimated this year's attendance was 125,000, down from last year's 138,000 according to WISH-TV. The event drew at least 200,000 fans during the first few years of the running of the race, which started in 1994. Officials blame the poor economy and the cost of gas for the lower attendance. Jimmie Johnson won his fourth Brickyard 400 this year, tying the number of wins by his teammate, Jeff Gordon.

Video Of Police Shooting

13 WTHR Indianapolis

WTHR released dramatic video footage captured by a dash cam on board a Fortville police officer's police cruiser when 27-year old James Lockhart opened fire on Officer Matt Fox last Friday night following a brief chase and seriously injured Fox. Other police officers later cornered Lockhart in a Lawrence subdivision nearby and killed him after exchanging gunfire with him. The video footage provides excellent evidence of what happened in the incident. Most IMPD police cruisers don't contain dash cams. The video cameras on board police cruisers can become a double-edged sword for police when they capture footage that shows a police officer using excessive force or otherwise engaging in inappropriate conduct during a traffic stop. In this case, the video provides clear evidence the victim later killed by police had first fired on a police officer without provocation.

Aurora Shooter Under Care Of University's Psychiatrist

New details about the psychiatric student responsible for last week's tragic shooting at a movie screening of "Dark Knight Rising" in Aurora, Colorado are emerging. James Holmes, a Phd. student at the University of Colorado, was under the care of a university psychiatrist, Dr. Lynne Fenton, prior to his recent decision to withdraw from his graduate studies at the school. According to the Denver Post, Holmes allegedly mailed a notebook to Dr. Fenton prior to carrying out the movie theater shooting that left 12 dead and more than 70 injured. The Denver Post is also reporting that Holmes' attorney has accused prosecutors of leaking damaging information to the media to discredit her client, a charge denied by the prosecution, which responded by claiming that some media stories about Holmes may have been fabricated, particularly stories reported by NBC News and Fox News.

Those dueling motions included the disclosure that Holmes, a 24-year-old Californian who enrolled in a doctorate program at the University of Colorado, was seeing Dr. Lynne Fenton, a psychiatrist. Fenton is the medical director of student mental-health services at CU's Anschutz Medical Campus.

Judge William Sylvester set a hearing Monday morning to consider the request by Holmes' attorneys that the notebook be turned over to them and prosecutors' motion that it remain sealed. The disclosure that Holmes was seeing Fenton raised serious questions in a possible death-penalty case, none of which the attorneys or university and law enforcement officials would discuss, citing a gag order.

Did Holmes reveal his plans to Fenton? Did Fenton tell the police? Will it become the basis of an insanity defense?

Therapists are required by law to investigate any threat of violence. They are supposed to determine the likelihood that the threats are real. If therapists believe a threat is real, they have a legal obligation to protect the intended victim or victims — notifying the police or taking whatever step necessary.

It appears that Fenton never opened Holmes' notebook, which was seized at CU's Anschutz campus by Aurora police after they obtained a search warrant. Fenton could not be reached for commentFriday . . .

Meanwhile, defense attorneys filed a motion seeking access to the contents of the package that Holmes apparently mailed to Fenton and identification of who had access to it in what appears to be an effort to figure out the source of the leak. Chambers responded by saying that the information in reports by Fox News and NBC were inaccurate, casting doubt on whether the person who leaked the story to the network was a law enforcement agent with access to the correct information.

"For instance, the Fox News story stated that the FBI took possession of the package — this is incorrect, as it was the Aurora Police Department," Chambers wrote in the motion filed Friday.

Police are not examining the contents of the package, Chambers said. "The contents were secured and not examined and held for potential in camera review," she wrote, referring to the process where a judge privately reviews information to decide whether the defense and prosecution may have access to it. Chambers also said media outlets may have made up sources and information.

"To put it bluntly, the People are extremely dubious of the media assertions that 'law enforcement sources' exist," she wrote. The media, she said, are getting information from "hoaxers, fraudsters or maybe from nobody at all.

The Denver Post also reported that Dr. Fenton had been reprimanded in 2005 by the Colorado Board of Medical Examiners for writing prescriptions to herself, her husband  and an employee. CNN is also reporting that Dr. Fenton formerly served as chief of physical medicine for the U.S. Air Force in San Antonio, Texas.

Ballard Hands Out Double-Digit Pay Raises To Top Staffers

Eyebrows are being raised in some corners at double-digit pay raises Mayor Greg Ballard recently handed out to top staffers in his office at a time when the City is facing a major budget deficit and city agencies are being asked to cut their budgets to the bone. Will the mainstream media cover it? Or will they ignore it like all of the other corruption taking place in Indianapolis city government?

Former IMPD Spokesman Has Warning To Spokane About Straub

Paul Thompson is now a retired IMPD police officer. Not long ago he served as a spokesman for the Department during a number of the controversies that erupted during the tumultuous tenure of Public Safety Director Frank Straub, which is suppose to come to a close at the end of this month. Straub has applied for several law enforcement management positions around the country since the Ballard administration announced that he would be stepping down, and he's currently one of the three finalists being considered for police chief of the Spokane, Washington police department. Speaking to a local TV news affiliate in Spokane, KREM, Thompson had a warning about the problems Straub faced in his position here. Thompson accused Straub of not being fiscally responsible and insisting on the use of two full-time police officers as personal chauffeurs. KREM's Ashley Korslein attempted to get comment from both Straub and the Ballard administration on Thompson's criticism of Straub but neither returned her messages. The Ballard administration has not yet announced the three finalists that were to be named by this point for consideration as Straub's replacement as public safety director.

Cook Medical Cancels Expansion Plans Due To Obamacare Tax Increases

Bloomington-based Cook Medical had planned to open five new manufacturing plants in the Midwest, including Indiana, as part of a planned expansion, but it has shelved those plans because of a new tax that it will have to pay beginning in January under Obama's Affordable Care Act. The company says the new tax could result in the loss of 1,000 American jobs as it shifts its expansion overseas due to the unfriendly business climate Obama's administration has dealt it. From the IBJ:

Cook Medical Inc. had been planning to open five new manufacturing plants over the next five years in small communities around the Midwest, including Indiana, but has shelved those plans because of the hit it will take from a new U.S. tax on medical devices.

The Bloomington-based medical device maker estimates it will pay between $20 million and $30 million once the tax takes effect in January, Pete Yonkman, executive vice president of strategic business units at Cook Medical, said this week.

The 2.3-percent tax on sales of all medical devices was created as part of President Obama’s 2010 health reform law to help pay for its expansion of health insurance coverage to as many as 30 million more Americans. The tax is projected to raised about $2.9 billion per year . . .

Cook officials have long been critical of the medical device tax. Even before it became law, Bill Cook said it could cost the company as many as 1,000 jobs.

Since then, Cook officials have said their future growth will be focused overseas. Cook already has production facilities in Ireland, Denmark and Australia . . .

Gary Varvel On Bauer's Ouster

More On Bauer Drama

The Northwest Indiana Times' Dan Carden is reporting that State Rep. Linda Lawson (D-Hammond) is likely to be named as an interim minority leader for the Indiana Democratic caucus at a caucus meeting called today in Lafayette to remove their long-time Democratic leader, Pat Bauer. Carden's source is State Rep. Charlie Brown (D-Gary).

Brown said at least 21 Democratic representatives must agree to remove Bauer, D-South Bend. He said he's confident the votes are there to oust the former House speaker.

"It appears as though the majority of the members of the House Democratic caucus are screaming for a change in leadership," Brown said.

But Bauer isn't going quietly. During an unusually long 40-minute Statehouse news conference Wednesday, Bauer said the effort to remove him is unnecessary, unfair, illegal, destructive to the party, "distractful" and disrespectful.

He insisted House Democrats cannot hold a meeting because state Rep. Vanessa Summers, D-Indianapolis, the caucus chairwoman and a Bauer ally, did not call for one.

WRTV's Norm Cox also reported that Bauer's State House office had been cleared of many of his personal belongings when reporters gathered in it yesterday to get his reaction to news of the latest efforts to remove him. His wife told reporters that the items had been removed in the event of a sudden shift in command. Bauer acknowledged to reporters that he had faced criticism within his caucus on a host of issues, including that he is "follically-impaired." Cox said Bauer, who has long worn a toupee, had never before publicly talked about his hair.

UPDATE: At a caucus of the 23 of the 30 Democratic members of the House today in Lafayette, the members voted to oust Bauer as minority leader and name Rep. Lawson as the interim minority leader through the November election. It is unclear whether Bauer will recognize the legitimacy of the decision. Indiana Democratic Party Chairman Dan Parker congratulated Lawson and says that she has the state party's backing. Indiana GOP Chairman Eric Holcomb released a statement indicating that his party is sorry to see Bauer go.

Bankruptcy Judge Rejects Fair Finance Trustee's Proposed Contingency Fee Agreement

A federal bankruptcy judge overseeing the bankruptcy estate for Fair Finance has rejected an attempt by the law firm serving as bankruptcy trustee to convert its compensation agreement with the court from an hourly rate to a contingency fee agreement. Judge Marilyn Shea-Stonum was highly critical of Baker & Hostetler's Brian Bash, the trustee, for proposing the change 27 months into the case and his failure to pay out any money to the creditors. Bash has recovered more than $6 million from various businesses and individuals who received funds Durham and his business partner, James Cochran, diverted from the Ohio-based factoring company before it went bankrupt. The firm, however, had billed about $3.5 million for its services through the end of 2011. Bash had proposed allowing his law firm to keep 30% of the first $50 million he recovered, reduced on a sliding scale to 15% for more than $50 up to $100 million and to 10% for any amounts collected above $100 million. Judge Shea-Stonum criticized the plan as “heads we win, tails you lose” approach.

In an astonishing move, Bash got the bankruptcy court to approve the sale of United Express, Inc. to former business associates of Tim Durham for a paltry sum of $600,000. The Durham-controlled company had drained millions of dollars from Fair Finance over a several year period. Under the favorable terms of the sale signed off on by Bash, a former Durham business associate, Terry Whitesell and several other individuals, will be allowed to pay the purchase price over a three-year period in monthly installments ranging from $11,666 to $18,333. A knowledgeable source says Bash blinked when Whitesell and his associates threatened to close the company and walk off if he didn't approve the sale of the company on their terms. The source says other businesses in the truck trailer industry were willing to pay a far greater sum for the company when they learned how cheaply Bash was going to sell it to Whitesell and his business associates but were rebuffed by the trustee.

Star Favors More Handouts To Developers At The Expense Of Schools

Mayor Greg Ballard's administration and the Democratic-controlled city-county council are wrestling over a plan to expand a downtown TIF district to include the already successful Mass Avenue business district to aid in prospective new development along the business corridor. The Democratic-controlled council has just concluded a lengthy investigation of TIF districts and found the need for a lot of reforms. The city has been increasingly using TIF districts to aid in development efforts over the past several decades. Every time an existing district is expanded or a new one created, it removes more of the property tax base from the reach of other taxing districts for other primary uses like the schools, public safety and public libraries. New tax revenues spurred by new development are instead diverted to slush funds controlled by the mayor to do with as he pleases, which typically means giving the money to private developers who make big contributions to his campaign committee.

The Ballard administration considers an area along Mass Avenue where a fire station, a credit union and low-income housing for seniors and disabled currently exists to be a "dead zone." They want to turn the one block stretch of property to a private developer to redevelop into a mixed use of residential and commercial property. The credit union and fire station will go, and one of the few green spaces along the avenue will be redeveloped to "maximize its potential." Essentially, their argument is that it is impossible for any new development to occur anywhere downtown unless the property is placed in a TIF district and the tax revenues from it are diverted to give tax subsidies to developers at the expense of the other taxing districts. The Star's editorial board is in total agreement despite how it often complains that schools and other essential services are grossly underfunded.

Development gaps along Mass Ave have long kept the Downtown shopping, restaurant, arts and entertainment district from reaching its full potential . . .

But the council's leadership would do well to remember that the city in many ways is at a disadvantage in competing for business with the suburbs. Further development of Mass Ave and other areas in and near Downtown is needed to attract new residents, who in turn will increase the city's income and sales tax revenues. Those taxes are even more important for cities now that Indiana has capped property tax rates.

For now, the city gets no tax revenue from the fire station, Barton Towers or the former bottling plant because the properties are held by branches of government. So, in the long term, any commercial or residential development that occurs because of TIF will help the city's finances.

It's important for Mass Ave, the rest of Downtown and the entire city that the proposed developments be allowed to move forward without further delay.

I'm all for new development that is needed, but I think this argument that public subsidies have to be handed out every time someone wants to develop a piece of land downtown has just about been worn out. Downtown is one of the most vibrant areas of the city. Without any public subsidies, Mass Avenue has been completely transformed over the past couple of decades. This is a case where developers want to access public money to invest in an already successfully developed area. TIF districts were never intended to be used in such areas. The idea was to use TIF districts as an economic development tool to develop blighted areas. This is not a blighted area, and it does not need public subsidies to make development possible. The council should not take more tax revenues off the tax rolls and divert them to a slush fund controlled by the mayor. I hope the Democrats hold firm in their opposition to this expansion, but I doubt they will.

Tully On Pat Bauer

Star political columnist has a interesting column today explaining why House Democrats need to dump their long-time leader, Pat Bauer, whose service in the House dates back to the days of Richard Nixon. He talks about efforts led by caucus members Scott Pelath and Linda Lawson to oust him. They tell Tully they have the 21 votes to oust him but for some reason are unable to get those 21 members to show up for a caucus to pull the trigger. Members have succeeded in getting Bauer to share the campaign finance duties with other members, but apparently Bauer pulled a fast one and transferred the funds in the campaign account to another bank account that he controls before the other members got their hands on it, a move Bauer insists is legal according to his attorneys. He describes "occasionally bizarre scenes" such as when Bauer showed up at the Indiana Democratic Party offices earlier this month "demanding that he be allowed to peek inside offices there to see whether rival Democrats were meeting in secret."

It looks like one of the stumbling blocks to removing Bauer is disagreement within the caucus over who will succeed Bauer if he is removed. Some members want Pelath, while other members prefer Trent Van Haaften according to Tully. Bauer's situation is similar to the one Richard Lugar found himself in as he unsuccessfully sought re-election to an unprecedented seventh term. I'm not sure why these guys can figure out how to leave office gracefully. Like Lugar, Bauer's decades of service both as a legislator and school teacher, as well as his great job at Ivy Tech after he retired as a school teacher, ensure him a great pension benefit on which to retire. After 42 years of service in the House, does he really think that he has that much more to contribute during the next two years that it's worth suffering the humiliation of being shown the door by your own colleagues?

Indiana GOP Hits Gregg's Legislative Record

Indiana State GOP Chairman Eric Holcomb believes Democratic gubernatorial candidate John Gregg is embellishing his record during his tenure as Speaker of the Indiana House of Representatives, particularly on the issues of fiscal restraint and property tax reform. "Speaker John Gregg has consistently embellished his record as speaker, trying to claim credit for balanced budgets and reforming property taxes, but his Fiscal Report Card shows a record riddled with gimmicks and delayed payments, massive deficits and a refusal to repeal a tax harmful to Hoosier farmers and families," Holcomb said. He continued:

Holcomb says that when Gregg became Speaker back in 1996, Indiana had a $1.7 billion budget surplus. By the time he left office, the state had a budget deficit of nearly $1 billion, contradicting Gregg's claim that he always balanced the budget when he was Speaker. The final state budget under Gregg's leadership spent about a half billion dollars more than the state collected in revenues. When Gregg was asked by a reporter as the time where the money went, Gregg responded, "Well, it was spent."

After the state's property tax system was declared unconstitutional by the Indiana Tax Court, Gregg promised real property tax reform, but in the end Gregg chose "tweaking" of the existing system through "assorted tax reductions and controls" rather than comprehensive reform. Holcomb cites a special session called by former Gov. Frank O'Bannon in 2002 to provide relief to homeowners facing skyrocketing property taxes due to the inaction of the legislature under Gregg's leadership. "Gregg is trying to claim credit for reform when all he did was kick the can down the road a little further," Holcomb said. Holcomb also hit Gregg on his opposition to a repeal of the inheritance tax, which Gregg said at the time had "a big price tag on it."

Gregg denounced Holcomb's criticism of his record by calling him a "hatchet man." "Rather than own up to that record and defend it, John Gregg's campaign lashed out," Holcomb responded. "Is this the kind of rhetoric we should expect from a candidate for governor?" Holcomb asked.

Government Grant Money Used To Purchase Holmes' Guns

James Holmes as he appeared at his  initial court appearance

Soon after Aurora police began detailing the large stash of weapons, ammunition and other equipment a 24-year old neuroscience Phd student, James Holmes, had assembled during the past few months, some questioned how an unemployed student could afford to spend so much money on an arsenal he would later use to stage an attack at a movie theater screening of "Dark Knight Rises." Two days after the shooting, university officials at the University of Colorado where Holmes had been studying offered a hint when they disclosed that Holmes had been one of just six students at the university awarded grants from the National Institutes of Health to study neuroscience. Pressed for more information, university officials yesterday disclosed that Holmes was being paid $26,000 a year for his studies.

University of Colorado officials disclosed Monday that massshooting suspect James Holmes was being paid $26,000 a year for his studies — money that could have financed the cache of firearms, ammunition and explosive devices found in his apartment.

Holmes, 24, unexpectedly dropped out of an elite neuroscience graduate program June 10 after failing part of his first-year final exam. School officials say they were stunned to learn of his arrest Friday after a shooting rampage at a packed movie house a few miles from campus that left 12 dead and 58 injured. Police found Holmes' apartment near campus filled with booby-trapped explosive devices . . .

"Everybody is in a state of shock," graduate school Dean Barry Shur said. "Everybody is upset. Who wouldn't be?"

The program to which Holmes was accepted last fall admits just six students a year. Candidates have top grades and "near perfect" test scores, Shur said. They undergo a background check but no mental examination. "No program requires psychiatric evaluation, to the best of my knowledge,"

Holmes came with "excellent academic credentials," Shur said at a press briefing Monday flanked by school Chancellor Don Elliman and Executive Vice Chancellor Lilly Marks.

Shure and other administrators were at a loss to explain Holmes' motive, especially given Shur's comments that the faculty "tightly monitors" its neuroscience students.

Doctoral students receive free tuition, and most get federally sponsored 12-month grants of $26,000, about $500 a week. Holmes, who was not employed, bought an assault rifle, shotgun, two semi-automatic handguns and 6,000 rounds of ammunition in the months leading up to what police called a methodically planned shooting spree.

Over the weeks before Holmes left, 90 packages containing ammunition and other items were shipped to the campus. Elliman said there was no way of knowing the volume or content of the shipments, which went directly to Holmes or to a campus mailroom. "We have thousands of packages that come here every day," he said.

In another development, ABC News is once again under fire for its coverage of the Aurora shooting. In the morning hours following the shooting, ABC News' Brian Ross during a live broadcast exchange with "Good Morning America's George Stephanopolous attempted to link Holmes to a Colorado Tea Party. It later turned out that the Jim Holmes who belonged to the organization was a different man. Red-faced officials at ABC News were forced to issue a public apology. Now the mother of James Holmes is claiming that during that same broadcast, officials of the network intentionally misrepresentated an early morning phone interview they had with her in the hours following the shooting about her son.

Arlene Holmes, the mother of Colorado theater shooting suspect James Holmes, says that ABC News mischaracterized her when it reported that her initial statement to the reporter, “you have the right person,” was a reference to her son.

“This statement is to clarify a statement made by ABC media. I was awakened by a call from a reporter by ABC on July 20 about 5:45 in the morning. I did not know anything about a shooting in Aurora at that time,” Holmes said in a statement this afternoon, read to the national press by attorney Lisa Damiani. “He asked if I was Arlene Holmes and if my son was James Holmes who lives in Aurora, Colorado. I answered yes, you have the right person. I was referring to myself.”

“I asked him to tell me why he was calling and he told me about a shooting in Aurora,” she continues. “He asked for a comment. I told him I could not comment because I did not know if the person he was talking about was my son, and I would need to find out.”

In the first paragraph of its initial report on Friday, ABC News reported that it had identified the correct James Holmes because his mother “told ABC News her son was likely the alleged culprit, saying, ‘You have the right person.’”

As it turns out, Holmes' parents had not even been contacted by police and informed that their son had been apprehended in the mass shooting before the ABC News reporter contacted her and told her about it. One has to question how ABC News was so quickly able to learn who Holmes' parents were and to track their whereabout down when the public was still in the dark about the identity of the person taken into custody as a suspect in the shooting. ABC News reporter Matthew Mosk acknowledges that he awakened Arlene Holmes with his telephone call at 5:45 a.m., but he insists he did not take her comments out of context when he quoted her as saying "You have the right person. I need to call the police." Holmes' attorney contacted ABC News and asked if an audio recording of the conversation existed and was told by ABC News that the conversation had not been recorded by Mosk.

Latest Mike Pence Ad

When I heard the latest Mike Pence ad was about jobs, I thought it might contain a little substance, unlike all of the other feel-good ads that his campaign has run to date. I thought wrong. It's more of the same.

Indy Gay Bar Target Of Drive-By Shooting

A street-front window of a downtown Indianapolis gay bar was shattered by a gun shot Saturday night according to the bar's owner. IMPD is treating the broken window as being caused by "possible gunfire", but the bar's owner says that he is certain it was caused by gunfire. From the Star:

Police are investigating a possible drive-by shooting at an Indianapolis gay bar, but the bar’s owner said he is certain the blown out window is more than a random act of violence and may be a hate crime.

A large picture window at Greg's, a gay bar on East 16th Street, was shattered Saturday night at 9:30 p.m. by what police say was “possible gunfire.”

But the bar’s manager is certain it was gunfire, and certain, too, his place was targeted because it caters to homosexuals.

“It was obviously a bullet,” said Phil Denton, the manager who was working at the time. “We’ve had rocks thrown at us, and names shouted at us, but never before a bullet.”

No bullet was found and no one was injured.

A police report characterized the incident as “vandalism” and said there were “no suspects or witnesses.”

Denton said that based on his discussions with bar patrons he believed a shot was fired from an eastbound car and that the car was “a Mercury or a Lincoln.”

More than 600 IMPD officers were patrolling downtown Saturday night due to the large number of people gathered for the final night of Indiana Black Expo, an event that has been marked in past years by numerous shootings and multiple arrests. City officials said this year's event was free of violence.

Super PAC Ad Takes Aim At Prince Ben Quayle

U.S. Rep. Ben Quayle won a close, hard-hitting primary two years ago in Arizona and went on to win his first term in Congress. As a result of redistricting, he has been thrown into a newly-drawn district with a fellow Republican, U.S. Rep. David Schweikert, and is in a tough primary battle to survive. Although a majority of the district includes Quayle's current district, Quayle's Scottsdale home is not in the newly-drawn district. The National Horizon Super PAC is running a negative ad referring to Quayle derisively as a "prince." The founder of the PAC, C. Boyden Gray, served as White House Counsel to President George H.W. Bush. Quayle's father, Dan, of course served as the elder Bush's Vice-President.

Horrifying Scene Of Anaheim Police Attacking Peaceful Protestors

You have to watch this video to believe it. Residents in Anaheim, California gathered Saturday evening to protest a police action shooting that left one man dead earlier in the day. For no apparent reason, police began firing rubber bullets at the gathered crowd, which included women and small children, striking several of the people. The police then unleashed a canine on the crowd, which inflicted several bite wounds. The dog attacked a woman holding a small infant. According to a local news report, police attempted to buy cell phone videos captured by onlookers to cover up their actions.

Colorado Shooter Had Received NIH Grant To Study Neuroscience

New reports out of Colorado indicate that the accused shooter, 24-year old James Holmes, had been one of just six students at the University of Colorado to win a neuroscience training grant from the National Institutes of Health. University officials confirmed this fact to reporters early today.

"The focus on the program is training outstanding neuroscientists who will make significant contributions to neurobiology," the school said.

Holmes decided to leave the school of his own accord in June, giving the university no reason for leaving the program, the spokeswoman said.

Yes, federal tax dollars had been awarded to help this young man with no prior criminal history or treatment for mental illness to study the biology of the human nervous system controlled by the brain.

Most Americans are still trying to make sense of this mass killing that claimed 12 lives and injured 71 others at a screening of "Dark Knight Rises" at an Aurora, Colorado theater just miles from the scene of the tragic Columbine school shooting in 1999. Twelves students and one teacher were killed after two teen-age boys who attended the school and who were being treated with prescribed anti-depressant drugs went on a shooting spree. Investigators immediately told us that Holmes acted alone and his actions had no terrorist links. Some eyewitness accounts suggest that the shooter had assistance from another man who entered the theater prior to the shooting and propped open an emergency exit door shortly after the movie began after this person answered a call on his cell phone. It's unclear whether the shooter and the man who propped the door open are the same, but at least one witness described the man who propped the door open motioning for someone else when he stood at the emergency door exit. The shooter was wearing an armor-resistance black suit and a gas mask. Some witnesses suggest someone else tossed a gas canister into the theater from a different location that began emitting irritating smoke shortly before the shooter entered the theater from the emergency exit door that had been propped open. Some are also wondering how an unemployed 24-year old could afford the thousands of dollars he spent on his weapons arsenal and other equipment to carry out the acts.

I have no idea what really happened, but I have to agree with the skeptics who believe the shootings were carried out with assistance from others. That these skeptics would be concerned that rogue elements within our own government played a part in the massacre is not as absurd as some might think. We know that the underwear bomber was only allowed to board an airplane bound for the U.S. without a valid passport with the assistance of our government. The underwear bomber was on a terrorist watch list and his own father had warned the U.S. government of his concern that he was planning to carry out terrorist attacks. The underwear bomber's attorneys claimed our own government gave him a defective bomb to wear onto the plane. After the horrible terrorist attacks in Mumbai, India, we learned that David Headley, an American working for U.S. intelligence, had made a number of trips to the region to help plan the deadly attacks in 2008 that left 168 people dead. We know that our own CIA has run covert mind-control operations with the help of leading psychiatrists to get unwitting citizens to commit acts they would otherwise not commit. Few people realize that the Unabomber, Theordore Kaczynski, participated in these human mind control experiments while he was at Harvard. The attorney for Sirhan Sirhan, claimed that his client was under hypnosis as part of a government experiment run amok when he carried out the assassination of Robert Kennedy.

Earlier this year, the New York Times reported that the vast majority of terrorist plots have been hatched by the FBI. Interestingly, the FBI put out a public warning in May of this year that theaters might be the target of terrorist attacks, but the link to the public warning was quickly taken down after the Aurora shootings. News reports indicate that Holmes began purchasing guns and ammunition to carry out the attack in May, which coincided with his decision to withdraw from the Phd program he had started just last year. Every time one of these incidents occurs, they are used to promote curtailing gun ownership rights, the invasion of privacy and the eroding of individual rights in order to supposedly make us more secure. The timing of the attack is also suspect. It comes just as the Obama administration is pushing a new UN gun control treaty that would curtail gun trafficking that aids terrorists and rebels, which is a bit ironic given the U.S. government's covert sponsorship of the Fast and Furious operation that placed thousands of high-powered weapons into the most dangerous criminal elements in Mexico with deadly consequences.

UPDATE: For skeptics that the government would actually carry out false flag operations, check out this previously-classified document originally prepared in 1962 and not released until 1997 which discussed various false flag operations to create a pretext for attacking Cuba militarily. Some of the proposed false flag operations will send a chill up your spine, particularly proposals to hijack planes and blow up U.S. ships, as well as carrying out terrorist attacks on American soil. The so-called Operation Northwoods plan was signed off on by the Joint Chiefs of Staff but rejected by President Kennedy, who was assassinated the following year. A known CIA asset, Lee Harvey Oswald, was blamed as the lone gunman responsible for the assassination by the Warren Commission. A later investigation by the House Select Committee on Assassinations concluded that there was a conspiracy and that Oswald had not acted alone. The chief investigator for the Committee, Notre Dame law professor Robert Blakey, later said that he did not believe the CIA and its people had been truthful about its relationship with Oswald prior to the assassination and cannot be trusted.

IMPD Staffing Levels Lower Than Before 2007 Public Safety Tax Increase

People tend to forget that the major impetus for former Indianapolis Mayor Bart Peterson's $90 million a year, 65% increase in the county option income tax in 2007 was to fund public safety. The public was told the funding would allow the newly-created IMPD agency, which resulted from the merger of IPD and the Marion County Sheriff's Department, to hire at least 100 additional new police officers. The truth was that IMPD never hired the additional police officers with the revenues from the tax increase. IMPD later obtained a $3 million COPS grant from the federal government to hire 50 new police officers, but it never used the federal money for hiring the additional police officers. The Justice Department has been threatening to require the city to repay the grant money because its staffing levels actually fell after getting the money. IMPD's staffing level has fallen below 1600, which is the lowest level it has been since the merger took effect in 2007. WRTV has a story about the concern for the lower staffing numbers for IMPD and the potential threat of having to repay the federal grant money because the city reneged on its pledge to use the money for more police officers:

"The problem becomes, how long will that agreement be in effect if the numbers continue to fall without our looking to hire some sort of recruit class?" said Mary Moriarity-Adams, who chairs the City-County Council's Public Safety Committee. "Being below a key number also could cause us not to be allowed to have future funding because we've not been able to maintain what we had promised to begin with."

The Indianapolis Metropolitan Police Department has hired only 17 police officers over the past three years. During that same period, the department has lost more than 100 officers to retirements, terminations, deaths and disabilities.

"We have fewer officers on the street at a time when crime is going up and attacks on officers are increasing," said Lt. Rick Snyder, vice president of the Fraternal Order of Police. "It's only by keeping our officers safe that we're able to keep our citizens safe."

2013 looks even bleaker when it comes to hiring additional officers. The city faces a $41 million revenue shortfall. Eighty-five percent of the city budget funds some element of public safety and criminal justice.

To compensate for the shortage, the police department did away with smaller policing beats in favor of larger zones. The department concentrated larger numbers of officers in these high-crime zones.

"I don't know how effective the zone policing is going to be," said Moriarity-Adams. "But the fact of the matter is, other areas of the city aren't adequately covered, where people are paying taxes to see officers on their streets and in their neighborhoods."

When Ballard first ran for mayor in 2007, he claimed public safety was job one. Instead, his major priority has been focused on more corporate welfare for his campaign contributors and making sure the CIB is flush with money to hand out to the billionaire sports team owners. IMPD not only has fewer police officers on the street, it doesn't have enough money to pay for the basic supplies police officers need to perform their jobs. They even have to buy their own toilet paper for the bathrooms at the district offices because the Department claims it doesn't have the money to spare.

Media Already Linking Dark Knight Shooter To Tea Party

I'm just watching the tragic news of the shootings that took place at a screening of the new Batman movie, "Dark Knight Rises" in Aurora Colorado, during which a lone gunman shot and killed at least a dozen and wounded dozens more. ABC News is reporting that a man with the same name as the gunman taken into custody by police, James Holmes, is a member of a local Tea Party in Colorado. This is no accident, folks. Don't be fooled by media efforts directed by the Obama administration to strip you of your right to bear arms. The Omedia will be doing all it can to pin the blame for this shooting on the Tea Party and right wing extremists in an effort to rescue Obama's almost certain defeat in November as more and more Americans grow restless from the worst economic downturn since the Great Depression and fear of a totalitarian dictatorship he is seeking to impose on the American people in a second term. Isn't it interesting that the villain in this new Hollywood-produced movie is named Bane as Obama seeks to demonize Romney's ties to Bain Capital in his re-election bid? A little word play mind game going on there, eh?

UPDATE: Breitbart asks if ABC News' Brian Ross got the wrong James Holmes here in its attempt to link the shooter to the Tea Party. Alex Jones predicted the propaganda value of this movie to the New World Order before last night's shooting.

UPDATE II: Yep, ABC News fingered the wrong guy. The Hispanic Tea Party member with the same name is not the shooter. The network is now apologizing for their mistake.

Election Board Hires Two Law Firms To Defend Mulholland Lawsuit, Angering Beth White

I'm not sure what kind of corrupt madness is going on, but Marion County Clerk Beth White was fuming when the chairman of the Marion County Election Board, Mark Sullivan, and his Republican counterpart on the board, Patrick Dietrick, moved to remove the board's attorney, Andrew Mellon, and substitute him for two politically-connected law firms as the board's counsel defending a lawsuit brought by a losing Democratic state representative candidate, Zach Mulholland, at the board's meeting this week. You may recall the extraordinary action taken by the Marion County Election Board on the day of this year's May primary to prevent the nonslated candidate's campaign from handing out campaign fliers outside voting precincts. On the morning of this May's primary, Marion County Democratic Chairman Ed Treacy lodged a complaint that Mulholland's campaign was violating an obscure anti-slating law with the campaign fliers he was distributing on election day, a law that an Indianapolis federal court had declared unconstitutional in 2003. The board met in an emergency meeting and voted to enforce the unconstitutional law against Mulholland, at which point authorized personnel were dispatched to seize Mulholland's campaign literature in a scene straight out of Nazi Germany.

The ACLU of Indiana brought a lawsuit against the Marion County Election Board in the Marion County Circuit Court after Mulholland narrowly lost his primary race to the Democratic slated candidate in the race, Dan Forestal, who will face off in the November general election against former Indianapolis city-county councilor Scott Keller, a Republican. Without explanation, Sullivan made a motion at this week's board hearing to remove Mellon as the board's attorney in the lawsuit and substitute him with two law firms, Bose McKinney and David Brook's law firm, due to an unidentified conflict of interest Mellon supposedly had. White reacted angrily to the motion, explaining that Mellon had no conflict of interest and that her office had no money in the budget to pay the high legal bills the two law firms planned to charge her office for representing the board in the lawsuit. She added that the proposed engagement agreements by the firms placed no limits on how much they could charge her office. Sullivan insisted the move was necessary without further explanation and required immediate action since a summary judgment motion was pending in the matter. Dietrick seconded Sullivan's motion, and the board voted 2-1 to hire the two law firms. White could barely contain her anger and left the meeting abruptly upon its adjournment. I think it is an outrage that the Republican member of the board joined the Democratic chairman in the original move back in May to enforce the unconstitutional law and to waste taxpayer dollars fighting to defend the unconstitutional law. The political corruption in this county knows no bounds, and it's a bipartisan endeavor.

Law School Grades Don't Matter In Supreme Court Selection

The Indiana Law Blog has done yeoman's work in covering the proceedings of the Indiana Judicial Nominating Commission in interviewing candidates for vacant Supreme Court positions during the past two years. The latest selection process to fill the vacancy created by the retirement of Justice Frank Sullivan is no exception. Professor Joel Schumm provides an interesting analysis of the ten semi-finalists the Commission chose from the original 22 applicants to consider for a second round of interviews before narrowing their choice to three persons to recommend to the Governor for consideration. According to Schumm's analysis, the applicant's law school grades was not an important factor in the Commission's consideration; rather, he found that the performance of the applicant during the interview was a greater factor. Unfortunately, the public has to rely on the Indiana Law Blog's account of the interviews since the Commission does not webcast the interviews over the Internet for the public to view Schumm observes. As to the applicant's grades, Schumm observes that applicants with poorer law school grades fared better than those with better law school grades:

Those who advanced (and some who did not) have been actively involved in service to the legal profession through bar associations, Supreme Court agencies and committees, and the broader community. They also had particularly good interviews. Law school grades were seldom mentioned, and, when they were, merely as a passing compliment leading to a broader question.

Of the ten applicants with the highest GPAs, only 30% advanced to the next round (listed by highest rank first): Judge Vorhees, Ms. Lewis, and Mr. Slaughter.

Of the ten applicants with the lowest GPAs, 50% advanced (listed by highest rank first): Ms. Metzel, Judge Bradford, Judge Willis, Mr. Young, and Judge Nation.

Schumm notes that an applicant's class rank is probably a better measure of the person's law school performance than their actual grade point average. Unfortunately, many of the applicants did not disclose their class rank, particularly those with a lower GPA. I realize that grades aren't everything, but if you ever had to practice in front of a judge who seems to really struggle to understand the law, you would understand why some would prefer candidates who performed at least better than the average student in law school. Poor performance in law school might also reflect more on a student's poor writing skills than their actual mental aptitude.

Court of Appeals Restores Decedent's Lawsuit Against Marion County Coroner's Office

Some of you may recall this case three years ago where the Marion County Coroner's Office came under fire for mistreatment of a corpse it was removing from an apartment building. The case involved a 700-pound woman who died in her bed. The Coroner's Office decided that the decedent's body was too large to remove from her apartment on a standard-sized stretcher so the Chief Deputy Coroner, Alfie Ballew, had the office summon a tow truck operator to the scene with a flatbed truck to aid in the removal of the decedent's body. Workers dragged the mattress on which the decedent's body was laying covered only by sheet out the back door and through the apartment's courtyard while neighbors looked on in horror.  The workers then used a winch to drag the mattress onto the truck. Once the workers got the mattress on the back of the truck, the decedent's body was covered with a dirty piece of carpet for transportation to the coroner's office so the body could be autopsied. One neighbor videotaped the coroner's office's handling of the decedent's body and turned it over to local TV stations. The video went viral and gained media attention nationwide. Ballew defended the office's actions, claiming it had transported other obese decedents by flatbed truck previously. Marion Co. Coroner Dr. Frank Lloyd defended his employee's action as respectful, although he conceded that he would not want a member of his own family transported in this fashion.

According to news reports at the time, John Linehan, the former chief deputy of the coroner's office, told reporters that ambulatory devices were available for use by the coroner's office to transport decedents weighing up to 1,000 pounds, which could fit into an ambulance for transportation."When they scoop up dead dogs off of the street they don't treat them that way," Linehan said. "It's just not the way to treat a human being."  You may recall that Linehan and other white deputy coroners and forensic pathologists who were employed by the office were fired as part of a scheme concocted by Ballew and the office's former coroner, Kenneth Ackles. to replace white employees of the office with black employees. The office wound up paying out close to $1 million to settle racial discrimination lawsuits brought against the office, not to mention the more than $1 million the office spent defending the various lawsuits. Despite the outrageous conduct of Ballew uncovered during the race discrimination litigation, including fabricating ghost employment allegations against Linehan, the coroner's office retained her as the office's chief deputy.

The decedent's son later sued the coroner's office in the Marion County Superior Court for negligent infliction of emotional distress and intentional infliction of emotional distress. Judge Timothy Oakes granted the coroner's office summary judgment on the son's claims, holding that the office was entitled to law enforcement immunity from liability under the Indiana Tort Claims Act and summary judgment on both of his claims against the coroner's office. On appeal, the Court of Appeals reversed the trial court, holding that the coroner's office was not entitled to immunity because it was not engaged in enforcement of the law during the transportation of the decedent's body. The Court of Appeals affirmed the trial court's dismissal of the son's claim for negligent infliction of emotional distress because he failed to show that he suffered a direct physical injury from witnessing the removal of his mother's body; however, it reversed the trial court's grant of summary judgment on the son's intentional infliction of emotional distress claim. The court found that there was a genuine issue of material fact whether the coroner's office "conduct is so outrageous that it satisfies the reckless element of the tort. "While an attempt was made to shield her remains from the gathering pedestrians when winching the mattress onto the truck’s flatbed, designated evidence shows media footage of Smith’s remains being moved onto the flat bed and covered by a dirty carpet," the Court's opinion reads. "Interviewed witnesses expressed their indignation and outrage over the Coroner’s Office treatment of [the decedent]."

State Paid Barnes & Thornburg $9.6 Million For Losing Case Against IBM

The state's lawsuit seeking hundreds of millions in damages against IBM for the failed welfare privatization implementation was a dubious lawsuit from day one. It was no secret that the Daniels administration had conspired with the law firm of Barnes & Thornburg , which represented ACS, to concoct a plan to privatize the state's welfare services and steer the bulk of that work to the law firm's client. It began with making sure that Daniels appointed a former ACS executive, Mitch Roob, to run the agency. Roob and another former executive of ACS, former Indianapolis Mayor Steve Goldsmith, immediately began pushing a model based on a privatization model being implemented by ACS in the state of Texas, one that would ultimately be chosen by the agency Roob ran. That model was known as "remote eligibility," one under which remote call centers would process all claims for welfare benefits over the Internet or over the phone rather than the traditional model of having case workers in county offices who met with those applying for benefits face-to-face. Word spread quickly among potential bidders that the bidding process was rigged in favor of the coalition of companies responding to the public bid, which was led by IBM but included ACS as the major subcontractor participant. In the end, all competitors dropped out of the bidding process, leaving the IBM-led coalition as the sole bidder for a more than $1 billion, 10-year contract, the largest in the state's history. The state inked a contract with the IBM-led team despite the fact that the model upon which it was based in Texas had been halted by that state's governor because problems with implementation were "so severe."

As Judge Dreyer's opinion denying all claims the state made against IBM found, the bulk of the services provided under the privatization contract were being performed by ACS, which was the source of most of the complaints against the system when its first rollout began. Instead of working with its prime contractor to work through the problems, ACS's lobbyist at Barnes & Thornburg, Joe Loftus, began meeting secretly with high levels of the Daniels administration behind IBM's back to undermine its control of the contract, including Gov. Mitch Daniels. Judge Dreyer noted one e-mail exchange that Loftus had with Roob where he complained that IBM "just didn't get it" in reference to frequent lectures he received from them reminding him that IBM was the lead contractor and the principal point of contract for all communications under the conract. Even ACS officials who testified at the trial conceded that Loftus' communications behind IBM's back constituted a breach of their contract, and the state was breaching its contract with IBM by engaging in the direct communications with ACS. These communications created "distrust" among the contract partners according to Judge Dreyer's opinion. "Certainly the State showed that IBM did not perform well in some respects, especially when trying to get subcontractor ACS Human Services ("ACS") to answer phones notwithstanding evidence of ACS lobbying against IBM in violation of its own subcontract." But Dreyer found plenty of evidence offered during the long trial where the state and IBM traded claims against one another where the state had given favorable reviews of IBM's work. One scoring of the company's performance prepared by FSSA's Zach Main gave the company 9 out of a possible 10 points. What the evidence showed was that IBM was being scapegoated as public pressure mounted to drop the privatization move, particularly from state lawmakers.

The state had the option of terminating its contract with IBM for convenience, but it chose instead to terminate the contract for cause and put ACS in charge of a new hybrid approach to delivering services, and to file a lawsuit against IBM seeking more than $150 million in damages, and IBM, in turn, filed a countersuit against the company seeking more than $100 million in damages. What stunned legal observers was a decision by Gov. Mitch Daniels personally to hire the law firm of Barnes & Thornburg to represent the state's interests over the objections of Attorney General Greg Zoeller given that it had been knee deep in representing ACS from day one. The engagement agreement entered into with the law firm contained pages of disclosures concerning the law firm's potential conflicts. Some legal observers questioned whether the conflicts of interest raised in the engagement letter were even waivable under the rules of professional conduct. A key deputy chief of staff in the governor's office, Betsy Burdick, worked with her brother at the law firm, Brian Burdick, to ink the deal. Although Burdick signed the agreement, he's a bond lawyer and not a litigator or an expert in contract law. According to the Star's Mary Beth Schneider, the state has paid the law firm a staggering $9.6 million to represent the state's interests in the lawsuit. If the Attorney General's office had been allowed to handle the lawsuit, existing state employees would have been utilized at no additional expense to the state. Instead, the very law firm which played an instrumental role in the privatization fiasco was allowed to profiteer from its own handiwork. Judge Dreyer ruled against all of the state's claims against IBM, and he ordered the state to pay IBM more than $52 million. Remarkably, one of the key attorneys handling the lawsuit against IBM for the firm, Peter Rusthoven, had the audacity to accuse Judge Dreyer of writing an opinion that contained "unnecessary political commentary that is neither accurate nor relevant." I think what he meant to say was that he used words that hit too close to home. He said the state will appeal Judge Dreyer's ruling, and the firm will charge the state at least another $250,000 for its services.

For the life of me, I do not understand why a criminal investigation has not been launched by the FBI and the U.S. Attorney's office. This has got to be one of the most corrupt deals in the history of Indiana state government. Hundreds of millions of federal tax dollars were being misspent simply so big campaign contributors of Gov. Mitch Daniels could make a lot of money with no concern at all to the services being provided using those tax dollars. One of the administration's biggest critics in the state legislature is a Republican lawmaker, State Sen. Vaneeta Becker (R-Evansville). “The whole thing could have been avoided if the state from the beginning had just provided new computers and additional training to caseworkers,” she told the Star's Mary Beth Schneider. “A lot of this could have been avoided and a lot of costs.” Gov. Daniels, for his part, was totally unapologetic about the outcome and says he expects the decision will be overturned on appeal. Even if the state loses on appeal, he told Schneider that the more than $52 million the state will be required to pay IBM was irrelevant because they "are so tiny compared to the savings we’re achieving.” The state has spent more than a half billion dollars to date on the privatization effort. What do you expect from a guy who told Congress when he was OMB Director that the Iraq war would only cost taxpayers $50 billion? Oh, and did I mention that Gov. Daniels put a former paid consultant for ACS, Mike Gargano, in charge of FSSA after Roob's successor, Anne Murphy, left the agency after a short stint running the agency? Her sole task was to get rid of IBM after Roob stepped down to become head of the Indiana Economic Development Corporation. Murphy's short tenure simply provided cover for the conspiring parties. When that task was completed, she moved on and Gargano stepped in so ACS and Loftus would have a person under their thumb in charge of the agency.

Ten Semi-Finalists Named For Supreme Court Vacancy

The Indiana Judicial Nominating Commission has narrowed the list of candidates to fill the vacancy created by the retirement of Justice Frank Sullivan to ten semi-finalists after interviewing all 22 candidates who applied for the vacancy. The list of semi-finalists, which includes six women and four men, is as follows:

1. Hon. Cale J. Bradford, Indiana Court of Appeals
2. Hon. Frances M. Gull, Allen Superior Court
3. Ms. Erin Reilly Lewis, Indianapolis
4. Ms. Andrielle M. Metzel, Indianapolis
5. Hon. Steven R. Nation, Hamilton Superior Court 1
6. Hon. Loretta H. Rush, Tippecanoe Superior Court 3
7. Mr. Geoffrey G. Slaughter, Indianapolis
8. Hon. Marianne L. Vorhees, Delaware Circuit Court 1
9. Hon. Mary G. Willis, Henry Circuit Court 1
10. Mr. John P. Young, Indianapolis

The Commission plans to interview the semi-finalists on August 8 and 9 before narrowing the search to the three finalists it will submit to Gov. Mitch Daniels for consideration. The Commission and Gov. Daniels are feeling pressure to appoint a qualified female candidate in light of the fact that no women currently serve on Indiana's high court. Interestingly, the vast majority of the 22 candidates this time around were woman. Of the 16 women candidates, only six or about a third were advanced as semi-finalist candidates, while the Commission advanced four of the six male candidates who applied for the vacancy. I have no good guesses as to who will be the three finalists or who the Governor's ultimate choice will be.

Justice Robert Rucker also ended speculation that he might retire from the bench this year. He filed paperwork to be placed on the November ballot for judicial retention. Justice Steven David, who was Gov. Daniels first appointee to the Supreme Court, will also face retention this November.

Judge Dreyer's Decision Vindicates Carl Moldthan

Carl Moldthan started out as a big fan of Gov. Mitch Daniels who gladly accepted his invitation to join his administration in helping remake the Family & Social Services Administration. After less than a year on the job, Moldthan left the agency disillusioned and disheartened by Mitch Roob's single-minded mission of getting rid of the county welfare case workers and replacing them with remote call centers run by Roob's former employer, ACS. Carl passed away a little more than a year ago after suffering a serious stroke, but I couldn't help but think about him as I read through the decision Judge David Dreyer handed down today awarding IBM $52 million in a drawn out lawsuit during which the state and its former contractor traded multi-million dollar claims against one another after Daniels fired IBM when the state's privatization plan didn't go as planned. The Indiana Law Blog has uploaded a copy of his 73-page opinion here.

Moldthan visited all of the state's county welfare offices and learned first-hand what problems ailed the system. He found that dated computers and obsolete computer systems made it impossible for case workers to do their jobs efficiently. Add to that the low pay of workers and poor communications with mid-level managers and decision-makers in Indianapolis, Moldthan found a broken system. Moldthan pleaded the case for an alternative solution to privatization recommended by the consulting firm hired by Roob, but Roob and others rebuffed him. As Moldthan explained to me his disgust and disappointment at the chosen outcome:

The best example I can think of is a person who is brought into the Governors office and told by him that he wants you to operate the State Garage. You look at him and because it is such a challenge, you accept. The Governor hands you a pair of pliers and a regular screw driver and says, “Here you go, here’s your tools.”

You immediately take a deep breathe and accept the seemingly unbelievable task and proceed to try and do the job. After 5 years the Governor says, “Well, he’s tried his best to do the job but I’m going to hire a consultant to see if we cannot privatize it to do better.” The consultants report comes back and says that even though you have tried to do a good job, all of the screws are messed up and all the bolts are rounded off. Their advice, privatize!

Now anyone who would read this would say that this scenario isn’t fair. The person in charge wasn’t given the proper tools, the proper money the proper support so how could they succeed? The answer is they couldn’t. If this sounds vaguely familiar to what has happened at FSSA, it is.

Reading Judge Dreyer's opinion, it is unmistakable that he understood and took to heart the exact sentiment Moldthan summarized.

The largely undisputed evidence shows that the Governor, the Family and Social Services Administration ("FSSA") and various State of Indiana ("State") officials set out to fix Indiana's poorly-performing welfare system by inserting an untested theoretical experiment, and substitute personal caseworkers with computers and phone calls ("remote eligibility"). This is now admitted to be an error, and there is nothing in this case, or the Court's power, that can be done to correct it, or remedy the lost taxpayer money or personal suffering of needy Hoosiers. All that can be done in this case is to take the first step at setting the final numbers among so many millions already spent.

This case is about nothing but the intent of the parties, performance of the parties, and whether there was a "material breach" of the contract as a whole. Breach of public trust is not included here, consideration of private greed is not included here, nor is any measure of public injury. It is just about the money between the parties, much of which is already spent by the State.  

The good faith of the parties cannot reasonably be questioned, especially the hard-working employees of the State and IBM. But the competence of the parties in this project is sometimes open to question.  

The short ill-fated life of this super-sized contract will remain an enigma. Overall, the Court finds, as a matter of fact, that the State failed to meet its burden to show that International Business Machines Corporation ("IBM") committed a material breach of the contract. Certainly the State showed that IBM did not perform well in some respects, especially when trying to get subcontractor ACS Human Services ("ACS") to answer phones notwithstanding evidence of ACS lobbying against IBM in violation of its own subcontract. But the record is too laden with too much evidence of political factors, the overwhelming difficulty of attempting such a project, and the State's own inconsistent performance to not allow a conclusion that unsatisfactory results were not caused as much by the State as IBM. Considering the contract as a whole, IBM's performance does not show breach going to the heart of the contract, and the State did not prove otherwise.

I have always steadfastly maintained that it was never the intention of the Daniels administration to put IBM in charge of this major undertaking. I've contended that IBM's role was that merely as a placeholder to provide cover to Mitch Roob from criticism that he was steering the state's largest contract in Indiana history to his former employer. Judge Dreyer fully grasped this fact. In his opinion, he traces back the origins of the "remote eligibility" model for delivering welfare services by a private contractor to Roob and his former colleague at ACS, former Indianapolis Mayor Stephen Goldsmith. The model was based on one previously undertaken by Texas, which just happened to be an ACS project that also ran into serious problems with implementation. Dreyer observed that the problems with the Texas rollout were "so severe" that the project rollout was stopped even before Indiana signed the IBM contract. The documents Dreyer references in his opinion tying Roob and Goldsmith to the decision undercuts the administration's claim that Roob had not participated in the selection process that ultimately chose the IBM-led proposal that provided most of the work under the contract to ACS as the lead subcontractor. "The largest portion of the work among the Coalition members, and the largest portion of the compensation, went to ACS, which employed the personnel assisting in the processing of eligibility applications (many ofwhom were former State employees)," Dreyer wrote. Dreyer noted that all of the competing bidders had dropped out of the procurement process before it had concluded, leaving the IBM-led coalition alone as the single bidder for the state's largest contract.

Underscoring my view, Judge Dreyer noted evidence in the record that ACS's lobbyist, Joe Loftus, was lobbying state officials behind IBM's back to have it assume control of the contract and to oust IBM despite ample evidence that many problems with the implementation involved tasks performed by ACS. He cited testimony that Loftus "used his political contacts with the administration to help his clients, ACS and Arbor, with respect to Modernization" and "Anne Murphy relied on Joe Loftus as a source of information in her dealings with IBM." Judge Dreyer found that ACS was interfering with IBM's contract "by directly lobbying the Governor, and the State was unable or unwilling to redirect the revenue necessary to adequately fund Modernization with IBM." Judge Dreyer found that Loftus' lobbying actions were creating distrust among the contract partners. He cited an e-mail exchange Loftus had with Roob in which he said, "I expect to get a lecture today from IBM reminding me that they are the Prime." Loftus added, "They just don't get it." Dreyer found that Loftus' communication behind IBM's back "presumably violated its contract with IBM and the state was in violation of the terms of the MSA, which provided that IBM was the sole point of contact with regard to contractual matters." Loftus' communications included conversations directly with Gov. Daniels and one of his top staffers, Betsy Burdick, who is the sister of Brian Burdick, the Barnes & Thornburg attorney who signed the contract on behalf of the firm to represent the state in its lawsuit against IBM despite its obvious conflict of interests. Loftus' actions were that of a snake in the grass, completely stabbing IBM in the back to win the contract for his client. Dreyer noted that ACS officials testified that Loftus' communications behind IBM's back "were contractually prohibited." As Dreyer put it, "The Court is unable to find that IBM breached the contract by failing to adequately manage ACS at the same time ACS and the State were talking behind IBM's back.

In the end, the State cooked its case against IBM by the multiple favorable reviews members of the Daniels administration gave on various occasions both internally and publicly regarding IBM's performance on the contract cited in Judge Dreyer's opinion. Perhaps the administration officials were just blowing smoke to cover up the botched privatization effort, but it all came back to bite the state hard in the butt. Judge Dreyer figured out that IBM was sacrificed for window dressing purposes because of all the flack the state was getting over the privatization effort, particularly increased pressure from state lawmakers. Nonetheless, the conflicted attorneys at Barnes & Thornburg were shameless in their criticism of Judge Dreyer's opinion. "We believe the court's view that IBM's concededly bad performance did not materially breach the contract is wrong, and cannot be squared with the overwhelming evidence of poor performance," Peter Rusthoven said in a statement to the media. Rusthoven also said the ruling contained "regrettable, unnecessary political commentary that is neither accurate nor relevant." It's absolutely incredible that the law firm has been permitted to profit to the tunes of millions of dollars result of a problem largely of its own making. Gov. Daniels is promising to appeal the decision, which will allow the law firm to profit even more from their wrongdoing

State Ordered To Pay IBM $52 Million For Botched Welfare Privatization Deal

The state's Family & Social Services Administration attempted to scapegoat IBM for the failed privatization of the agency's welfare services, which was primarily carried out as a way of steering hundreds of millions of dollars to ACS, the former employer of the agency's then-Secretary Mitch Roob. When it became apparent the effort had caused harm rather than the promised benefits from the initiative, the state sought to blame the lead contractor IBM while retaining the services of ACS despite ample evidence that ACS had not performed its job well either. The Daniels administration then hired the law firm employed by ACS to win the contract in the first place, Barnes & Thornburg, to represent it in a breach of contract suit against IBM seeking more than $100 million in damages despite the law firm's conflict of interest. IBM fought back with its own countersuit. Today, Marion Co. Superior Court Judge David Dreyer ruled in favor of IBM on some of its claims against the state, and he ruled against the state of Indiana on all of its claims against IBM. Judge Dreyer's latest order requires the state to pay IBM $12 million for computer equipment the company purchased but the state retained for ACS's use on its continued contract with the state. Judge Dreyer had previously ruled that the state had to pay IBM $40 million to cover fees it paid to its subcontractors, bringing its total judgment to $52 million. Dreyer admonished both parties in his ruling.  "Neither party deserves to win this case," Dreyer wrote in a 65-page ruling. "This story represents a 'perfect storm' of misguided government policy and overzealous corporate ambition," the Star reported on his ruling. "Overall, both parties are to blame and Indiana's taxpayers are left as apparent losers." The ruling still left IBM without many of the damages it had sought from the state over the state's termination of its contract.

UPDATE: Gov. Mitch Daniels remains unapologetic about the badly-botched privatization deal. The Fort Wayne Journal-Gazette's Niki Kelly says the state will seek and expects a reversal of Judge Dreyer's decision:

“Here’s what matters: Indiana, which eight years ago had the nation’s worst welfare system, now has its most timely, most accurate, most cost effective and fraud free system ever. That was always the goal, and changing vendors was essential to achieving it. We’ll seek and expect a reversal, and either way, it’s all been well worth it to solve the problem we set out to fix.”