CHICAGO — Scaling down local government and expanding public-private partnerships for infrastructure are among Indiana Gov. Mitch Daniels top priorities for the upcoming legislative session, the governor said Thursday morning at a press conference.

The six-year Republican incumbent will now enjoy an all-GOP General Assembly after the party took control of both chambers in Tuesday's election.

Daniels said he spent Wednesday meeting with a handful of House and Senate members and expects to release a specific legislative agenda by Thanksgiving. He spoke to reporters before leaving for a two-week trip to China and Japan to try to attract new businesses to the state.

Daniels praised outgoing Democrats for helping accomplish several major changes in state government over the last few years, such as enacting property tax caps that lead to a major overhaul of the property tax structure.

Voters in Tuesday's election approved a proposed constitutional amendment to make the tax caps permanent.

"This is the outlines of a very ambitious agenda that will lead to more positive change for Indiana," Daniels said. "The protection of taxpayers always comes first for us, along with passing another budget that protects Indiana's fiscal stability and triple-A rating without raising taxes."

Expanded authority for P3s should be among lawmakers' top priorities, the governor said.

"We hope to maintain Indiana's position as an infrastructure leader by giving state government more tools to build roads and bridges," he said.

In March, the General Assembly wrapped up its 2010 session by authorizing the privatization of two of the state's largest infrastructure projects. The measures allow the governor to negotiate with private companies interested in financing and operating a proposed $1 billion toll road between Indiana and Illinois, as well as a $4.1 billion joint project with Kentucky to build a pair of bridges across the Ohio River.

Daniels said Thursday that he would consider revisiting the idea of privatizing the state lottery. He pushed the idea for years — saying proceeds would be used to finance college scholarships — but shelved it in late 2008 when the U.S. Justice Department ruled that states must maintain a majority ownership of lottery operations.

Daniels noted Illinois' recent decision to hire a private company to manage and expand the Illinois Lottery while retaining ownership, and said the P3 deal opens new possibilities for the Hoosier Lottery.

"Maybe the possibility can be brought back into consideration," he said. "If we did undertake it, I would be most interested in it as a way to help families with the cost of higher education."

On the local government front, the governor said he would push lawmakers to enact recommendations crafted by the Kernan-Shepard Commission, a state-appointed group that in late 2007 authored a high-profile report outlining ways to streamline government.

Lawmakers enacted some of the reforms — such as moving most of the assessment duties in townships to the county level — but many others were shelved.

Remaining recommendations include abolishing township governments, replacing county commissioners with an elected county executive, and reorganizing school districts so that they have at least 2,000 students.

"I am very hopeful that the Kernan-Shepard Commission recommendations will advance on many fronts," Daniels said. He added that the new Republican majority in both chambers could mean more of a focus on local government reform, though it's an issue that in the past has often divided both parties.

Daniels touted Indiana's fiscal position as among the best in the country, and noted that revenues are growing, though slowly. His remarks came a day after budget officials released a report Wednesday showing that revenues are rising but continue to lag projections.

Total state revenue collections came in at $959 million for the month of October, $6 million below the same period last year and $23 million below the most recent revenue forecast, the report said.

General fund revenues for the first four months of fiscal 2011 lag the latest forecast by $16 million. Sales tax revenue totaled $493 million for the month of October, marking the eighth consecutive month they have increased.

Officials will meet in December to release a new revenue forecast for fiscal 2011 and the first forecast for the 2012-2013 biennium.

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