CHICAGO — Indiana stands out “like a peony in a parking lot” among the states for the relatively small size of its budget problems, Gov. Mitch Daniels said in his annual state of the state address Tuesday night.

In last year’s address, the Republican governor warned lawmakers not to dip into the state’s vaunted $1.3 billion reserve fund, but this year he said it would be necessary to tap the account to get through the next year and a half. As of last month, Indiana had suffered 14 straight months of revenue declines and Daniels had ordered five rounds of budget cuts.

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