RUSHVILLE — The following is a copy of Gov. Mike Pence's State of the State address.

State of the State



Governor Michael R. Pence



January 22, 2013



As prepared for delivery:



Speaker Bosma, President Pro Tem Long, Lt. Governor Ellspermann, Senator

Lanane,

 Representative Pelath, members of the General Assembly and Judiciary,

distinguished

guests, my fellow Hoosiers:



I am honored to stand before you today as governor of all the people of

Indiana

and I know that, together, we will write the next great chapter of

Indiana history.



Thank you for that warm welcome. To my colleagues gathered here I say, my

remarks

will not be as brief as last week's inaugural address, but your feet will

be warmer!



Article V, of the Constitution of the State of Indiana provides that the

Governor

shall "give to the General Assembly information touching the condition of

the State,

and recommend such measures as he shall judge to be expedient."



In discharging that duty, I come before you to proclaim that the state of

our state

is strong and growing stronger because we have good government and

because we serve

a great people. If we will remain bold, confident and optimistic, I am

positive

we can lead our state from good to great.



Hoosiers owe a debt of gratitude to all the leaders gathered in this

room. Because

of your service in the recent past, our state has become the fiscal envy

of the

nation and a model from how good government works.



We have balanced budgets and surpluses when most states are broke or

struggling.

 We are one of only nine states with a AAA bond rating-higher than the

federal government.



But while we rightly celebrate our progress, these are still difficult

times for

 too many in our state.



As we gather this evening, a quarter million Hoosiers are out of work,

and nearly

one million Hoosiers lack the skills they need to succeed in today's

marketplace.



Despite progress in education, too many of our schools are still lagging

behind,

 some way behind.



And, especially heartbreaking to this father, one in five Hoosier

children lives

 in poverty. That is unacceptable.



With so many families and businesses struggling just to get by, we have

no choice

but to remain bold.



We have to do better.



And doing better starts with the right priorities. It starts by adopting

a roadmap

that says "yes" to our future and believes in the unlimited potential of

our people.



It all starts by making job creation job one.



That's why on day one of our administration, I signed a moratorium on any

new regulations

to ensure that Indiana is not burdening Hoosier employers with

unnecessary red tape.



And that's why we proposed a jobs budget last week.



Our budget is honestly balanced, holds the line on spending, funds our

priorities,

builds our reserves and lets hardworking Hoosiers keep more of what they

earned.



Let's be clear: Government doesn't create jobs, other than government

jobs, but

government can create the conditions where people can be the risk takers,

innovators,

and workers who will create the jobs and opportunities of tomorrow.



And everything starts with fiscal discipline, the surest foundation for

economic

 growth.



I believe our State must live within its means and never spend a single

dollar more

than it collects.



So, first, we have submitted an honestly balanced budget, with no tax

increases.



Second, our budget holds the line on spending.



I believe the government budget should never grow faster than the family

budget.

 Our budget is a full percentage point less than inflation. By holding

the line

on spending, Indiana can continue to stand out as a beacon of fiscal

restraint-a

 state that knows how to fund its priorities in a responsible way.



And our budget funds our priorities:



Our budget proposes an increase in funding for education, including full

day kindergarten,

and fully funds teacher pensions each of the next two years. As a result,

education

represents 64 percent of all state expenditures.



In addition, we provide $18 million over two years to ensure that all

Hoosier workers

have the skills to find a job in today's economy.



And since roads mean jobs, we're investing nearly $347 million in excess

reserves

on Indiana's roads, bridges and infrastructure.



Our budget creates a partnership with Indiana's life sciences industry

and our universities,

to spur research and produce high-paying jobs.



And because Indiana is agriculture we envision our state becoming a hub

of food

and agricultural breakthroughs by supporting an Agriculture Innovation

Corridor



Our budget also ensures that the Indiana Economic Development Corporation

is adequately

equipped to both attract more business and investment to Indiana and

operate with

greater transparency and accountability to the public.



And lastly, our budget keeps faith with those to whom we owe the most.



It was Abraham Lincoln who said we must, "care for him who shall have

borne the

battle." But in Indiana, our veterans are hurting, and they need our

help. Post-9/11

Hoosier veterans have an unemployment rate higher than the national

average. We

have to do better. We owe these heroes nothing less. Heroes like Big Tim

Wysong.



He got that nickname on the football team at Hagerstown High School,

where he graduated

in 2006. He decided to join the U.S. Army and arrived in Afghanistan on

his first

deployment in 2009. One night in June, driving through a village, their

convoy came

under attack. An RPG (rocket propelled grenade) exploded on the door,

pushing copper

plating through it, destroying Tim's left leg. Nevertheless, Tim Wysong

was able

 to hold the 350-pound door shut until they were able to stop, likely

saving the

 lives of everyone in the vehicle. He's had close to two dozen surgeries.

The most

recent one was done a year ago in August. Last fall he got married and

did his first

5K.



Big Tim Wysong is an American hero, and Big Tim is with us tonight.



Our budget makes a clear commitment to Hoosiers who have served their

nation in

uniform by investing more money in job training and certifying Veteran

Service Officers.

I have also set a goal to procure 3 percent of state contracts from

veteran-owned

businesses. They stepped forward for us, now it's our turn.



And, finally, our budget puts taxpayers first.



Government should only collect what it needs. When government collects

more than

 it needs, it should return that money to the hardworking taxpayers who

earned it

in the first place. That's why I'm proposing we lower income taxes by 10

percent,

across the board, for every Hoosier over the next two years



Hoosiers work hard. They labor in a fragile economy. They save and invest

in their

families and businesses and family farms. Why wouldn't we want them to

keep more

 of what they earn?



Now, I know there are some who say we have to choose between letting the

people

of Indiana keep more of their hard-earned dollars and meeting the state's

priorities.



As our budget clearly shows, we can do both.



The budget I submitted last week is honestly balanced, funds our

priorities, reduces

by 10 percent the tax bill Hoosiers currently pay, and still maintains

reserves

well in excess of the resources we would need to meet emergency and

unforeseen contingencies.



So let's be honest with our fellow Hoosiers: We can afford to do this.



But why cut taxes now?



First, at a time when federal taxes have just gone up on all working

Hoosiers, most

small businesses and family farms and our medical device industry, now

more than

 ever, Hoosiers could use some tax relief.



Second, this reduction in taxes will unleash half a billion dollars into

the private,

voluntary economy every year. Letting Hoosiers keep more dollars to

spend, invest

or save will be good for Indiana families and businesses.



Third, reducing the personal income tax rate is the best way to lower

taxes on small

businesses and family farms. Ninety-two percent of Hoosier small

businesses pay

their taxes under the individual income tax rate. By lowering taxes,

small businesses

will have more money to hire new employees, purchase new equipment and

grow.



Fourth, by lowering the personal income tax rate by 10 percent, it will

be official:

Indiana will be the lowest taxed state in the Midwest. Companies who are

here will

have one more reason to expand and we will give businesses outside

Indiana one more

reason to move to the Hoosier state.



Because we can afford to cut taxes for every Hoosier, I believe we

should. And on

behalf of millions of hardworking Hoosiers, small businesses and family

farms, I

 respectfully ask for your support.



Our jobs budget is all about getting this economy moving, but we can't

succeed in

the marketplace if we don't succeed in the classroom.



We have to put kids first and ensure that every child in Indiana has

access to a

 world-class education at public school, public charter school, private

school or

home.



I'm sure everyone in this Chamber has a favorite teacher. Mine is sitting

right

up there in the balcony-our new First Lady Karen Pence.



My wife Karen has spent her career in the classroom. We both believe

teaching is

 a calling, and Indiana has the best teachers in the world.



When most people tell you about their favorite teacher, they tell you

about the

one who pushed them the hardest, who challenged them to grow; the teacher

who held

them to a high standard.



Those teachers know that setting high expectations works. We believe

that, too.



Indiana teachers and schools have shown that they will rise to the

challenge and

 make tremendous gains for our children. This October, we learned that

207 schools

received the highest school ranking for the first time. Forty-three

schools moved

up three letter grades. Twenty-eight schools moved from the lowest

ranking to a

mid-ranking. This is a testament to the commitment and excellence of our

teachers,

and proof that our accountability system produces gains for our schools.



When it comes to our public schools, I believe we should fund excellence

in our

schools and our teachers.



That's why we proposed an increase in funding for schools each of the

next two years,

with the second year based on school performance and an additional $6

million in

 teacher excellence grants to increase pay for our high-performing

teachers.



We must continue to take steps to ensure that every third grader can

read, to promote

math proficiency by elementary students and to invest in highly

successful drop-out

prevention programs like Jobs for America's Graduates.



And our administration also will work with our new Superintendent of

Public Instruction

to cut the red tape that teachers face in the classroom, and let them

teach. Our

 children will get the best education when good teachers have the freedom

to teach

and are rewarded for excellence.



I have long believed that parents should be able to choose where their

children

go to school, regardless of their income. We must continue to expand

educational

 opportunities, especially for those with the fewest resources, beginning

with pre-K

education.



High-quality early education programs can have immediate and long-term

positive

effects for our kids. Many communities across Indiana are already

launching efforts

to provide pre-K programs for at-risk children. One of the best examples

is the

Busy Bees Academy in Columbus, which serves at-risk and disadvantaged

children in

my hometown. Let's work together to expand incentives for Hoosiers to

support this

kind of innovative, community-driven pre-K effort for our low-income

children.



In recent years, Indiana has given parents who previously had few choices

the ability

to choose the public or private school that best meets the needs of their

family.

This fall, more than 9,000 students attended a school of their choice.



Like Kennedy Davis and her brother Isaiah. The Davis family, from

Indianapolis,

used the voucher program to send Kennedy to first grade at Trader's Point

Christian

Academy. She's a second grader there now and her brother Isaiah is in

kindergarten

thanks, in part, to Indiana's school scholarship and tax credit program.

Kennedy

 and Isaiah are thriving. They're with us today. Keep it up, kids,

Indiana is proud

of both of you!



We've made progress in expanding choices, but we can do more. Expanding

tuition

tax deductions, removing the prior year requirement and lifting means

testing for

foster, adopted, special needs and military families would be a good

start.



But when graduation comes, we want to make sure that our schools work for

all our

kids, regardless of where they want to start in life-whether they are

headed for

 college or want to start a career right out of school.



Let's be clear, every Hoosier child should be encouraged to go to

college, and we

must work to make sure our kids are college ready and make college more

affordable.



To that end, we are proposing to increase funding to our state-sponsored

colleges

and universities and to tie our funding and financial aid to on-time

completion.



Even as we encourage every student to go to college, we recognize not

every student

is college bound. But they all deserve the same opportunity for success.

Since all

honest work is honorable work, our schools should work just as well for

our kids

 who want to get a job as they do for our kids who want to get a college

degree.



The time has come to make career, technical and vocational education a

priority

in every high school in Indiana.



To expand career and technical education, we need greater collaboration

between

agencies, and I propose we create Regional Works Councils to work with

business

and educators across the state to develop regional, demand-driven

curricula to bring

high-paying career options to more Hoosiers in high school.



And don't think for a minute that career and vocational education is

about limiting

the future for some of our kids.



Let me introduce you to Bill Beach. Bill and his wife Juanita are with us

tonight,

but we had to work hard to get them here. Turns out his New Albany-based

business,

which specializes in injection molding and precision tool making, is

booming. He's

running three shifts and employs 600 Hoosiers in a 410,000-square-foot

manufacturing

facility.



When I visited Beach Mold and Tool last summer, Bill told me how on the

farm when

he was a teenager his Dad came to him one day and said, "Bill, your

brother's good

with the book learning, so he's going to college. You're good with your

hands, so

you're going to vocational school."



So Bill went to vocational school. They started their company in 1972. As

we looked

out over the hugely successful business he's running today, I turned to

him and

said, "Bill, turns out your dad was right. You are good with your hands.

Look at

 what they built!" Join me in commending Bill and Juanita Beach for being

such a

 great example of the American dream.



Career and technical education can provide our students with a pathway to

success,

just as it did for Bill. It can launch entrepreneurs, give kids a reason

to finish

high school, and create a well-qualified workforce that will encourage

business

to build here and grow here.



We have to give our kids, our future, every opportunity for success. That

means

quality schools, choices about their education and multiple pathways to

success.

 The more our kids succeed in the classroom, the more Indiana will

succeed.



I believe a society can be judged by how it deals with its most

vulnerable; the

aged, infirm, disabled and innocent human life.



That's why our budget fully funds the Medicaid forecast, meeting the

projected health

care needs of our most vulnerable citizens and families.



That's why our budget calls for increasing funding for the Department of

Child Services

by $35 million so we can protect the lives of our most vulnerable

children through

additional caseworkers, supervisors, and investments in the emergency

hotline.



That's why our budget seeks resources for a comprehensive school safety

review.

Parents have a right to expect that our children are safe at school.



All of us were heartbroken after every parent's worst nightmare unfolded

in Newtown,

Connecticut. While others have rushed to the well-worn arguments over gun

control,

Hoosiers know this is not about access to firearms. It is about access to

schools.

Hoosiers have responsibilities to protect our kids and Hoosiers have

rights. We

will protect our kids, and we will protect our rights. Hoosiers know we

can do both.



And since an intact family is one of the surest guards against poverty,

on my first

day in office I signed an executive order requiring certain state

agencies to develop

family impact statements to ensure that new rules and regulations do not

unfairly

impact married, two-parent families.



Nothing in this approach to preventing poverty diminishes in any way the

heroic

job single parents do raising their children every day in Indiana. My

sister is

a single mom and my wife was raised for much of her childhood by a single

mom, and

we applaud the difficult job those parents do every day. But with

twenty-two percent

of our children living in poverty, given the undeniable relationship

between childhood

poverty and unmarried childbearing, Indiana should seek ways to encourage

strong,

healthy families for our kids, our communities and our state.



Let me close tonight by reflecting on something another speaker said from

this podium

more than 30 years ago. Addressing Indiana's General Assembly, President

Ronald

Reagan said, "the federal government is still operating on the outdated

and...arrogant

assumption that the states can't manage their own affairs." He predicted

that the

"great American experiment" would soon enter a new phase and that you,

here in this

room, would be the ones to carry this experiment forward and "offer the

most creative

solutions and most promising hopes for our nation."



As Hoosiers have shown over the past eight years, Reagan was right.



Hoosiers have found practical Indiana solutions to the challenges facing

their communities.

We have one of the most innovative healthcare programs in the country. We

have implemented

education reforms that are a model for the nation. And we have built our

roads on

time and under budget.



On these and other important matters, we must never stand by and let the

federal

 government dictate our aims, our hopes, and our wishes for us. As your

Governor,

I will never stop standing for the rights of Indiana's people to run our

schools,

choose our healthcare and produce our energy the Indiana way.



The road ahead of us will not be easy. But we know that Hoosiers are

willing to

do hard things, to embrace change, to demand a government as good as our

people,

 to build schools of promise and policies that will ensure jobs and

opportunities

for this generation and the next.



To do this, we must continue to live within our means, hold the line on

spending,

and let Hoosiers keep more of their hard-earned income. We must invest in

schools

and roads, and seek ways to support the state's most vulnerable citizens

and strengthen

the institutions that nurture the character of our people.



This is Indiana's moment.



We can put Hoosiers back to work and make Indiana first-first in job

creation, first

in education, and first in quality of life.



Together, we will build a more prosperous future.



Together, we will open doors of educational opportunity for all our kids.



Together, we can approach our third century with confidence,



With faith in Him who strengthened the hands of our pioneer forbearers

and boundless

faith in all of you, I say Indiana's best days are yet to come!



Let's get to work!



Thank you, God bless you, and may God continue to bless our beloved

Indiana and

all who call her home.