INDIANAPOLIS – Indiana schools would see a 2 percent increase in operating dollars under a one-year education spending bill passed 14-9 by the House Ways and Means Committee on Tuesday morning.

The panel amended the funding plan in House Bill 1723 and then passed the bill along party lines – with Democrats in support and Republicans against.

The legislation is an unusual approach to funding education in difficult economic times. Lawmakers traditionally pass one budget bill that covers a two-year period.

But House Democrats are using a separate K-12 schools budget bill that covers one year.

It sets their philosophy of giving new money to Hoosier children over general government.

"This will evolve in the process, but this is our direction," said Ways and Means Chairman Bill Crawford, D-Indianapolis.

Gov. Mitch Daniels’ initial budget proposal flatlined funding for K-12 schools.

"It’s a novel idea, but until we see the entire two-year budget and the offsetting spending reductions in other areas that will be necessary to provide these increases and maintain a balanced budget, it’s trying to complete a puzzle with only half of the pieces," State Budget Director Chris Ruhl said.

"The governor is adamant about not spending down reserves. His budget prioritized K-12 education, maintained a balanced budget through reductions in other areas, and preserved the reserves to protect against further decline in revenue collections."

House Bill 1723 provides more than $180 million in new education funding for fiscal year 2010, beginning in July.

That includes $116 million for basic operating increases for schools – or an average increase of 2 percent for districts.

But the money is distributed through a funding formula, so districts would receive varying amounts.

For instance, Fort Wayne Community Schools would receive a 4 percent increase, largely due to its population of at-risk children.

Southwest Allen County Schools would receive less than half a percent increase; East Allen County Schools would get 2 percent; and Northwest Allen County Schools would receive 1.4 percent.

Rep. Randy Borror, R-Fort Wayne, said he believes there is an error in the school funding formula, so he cautioned against relying on those numbers. A new analysis could be available this week.

In addition to the operating funds, the bill contains $28 million to fully expand access to full-day kindergarten in schools, more remediation funding, increased dollars to teach students English and an increase in textbook reimbursement.

The bill relies on at least $100 million from the state tuition reserve fund.

Rep. Jeff Thompson, R-Lizton, voted against the bill because he said the recession is "not the time to increase teacher salaries, and that’s what this does."

Rep. Eric Turner, R-Marion, said the bill spends nearly half of what is available in the state’s general checking account and doesn’t create jobs.

But Democrats defended the bill, saying the increased funding will keep schools from laying off hundreds of teachers.

"If we save a job for a teacher, that’s a pretty good contribution," said Rep. Ed Delaney, D-Indianapolis.

The bill now goes to the full House, where it likely will be amended.

nkelly@jg.net