Mysterious state office retooled, website launched

Pence forms OSBI after Call Team 6 Investigation

INDIANAPOLIS - The state of Indiana has launched a new website after a Call 6 Investigation exposed a state office spending hundreds of thousands of tax dollars without clear results, Call 6 Investigator Kara Kenney has learned.

Read about that investigation here .

Governor Mike Pence dismantled the Office of Federal Grants and Procurement, created by the administration of former Gov. Mitch Daniels in 2005 to bring Hoosiers more federal dollars.

On July 30,, 2013, Pence announced the establishment of the Office of State Based Initiatives through an executive order. In September, Call Team 6 Investigators found that the new office was raising questions of its own . For one thing, it had no website.

The state did launch a website in October for OSBI:

“OSBI has launched the new Hoosier Solutions website, which strives to ensure that expensive federal regulations do not compromise Indiana’s firm financial footing by knowing when to say, 'Thanks, but no thanks,' and works with Hoosiers to find better solutions,” said Christy Denault, spokesperson for Governor Mike Pence in an email to RTV6. “We invite Hoosiers to contact OSBI about the impact of federal regulations through the website’s suggestion box.”

Denault has not yet responded to a question asking how many visits the new website has received to date.

The state says the ultimate goal is for Hoosiers to get the most out of federal dollars, to lower taxes for Hoosiers and to lessen the negative impact of federal mandates.

“We want this office to be the place, the central clearing house where we can find the right kinds of strategic partnerships for the State of Indiana with the federal government,” said Chris Atkins, director of the Office of Management and Budget (OMB).  “We’re still seeking federal money for many programs, but we’re also trying to catalog where the negative impacts come in the long term.”

The Office of State Based Initiatives has an annual budget of $88,984 per year, and one employee on its payroll, executive director David Johnson.

Johnson works within the OMB offices at 1 North Capitol Avenue, but Johnson was not there when Kenney stopped by in September.

Kenney asked Atkins how the office will achieve its goals on such a small budget.

“I'm happy to report we make resources stretch pretty thin here,” said Atkins. “We try to protect taxpayers.”

Atkins explained other employees within OMB are working with Johnson to reduce the impact of federal mandates.

“This new office, for the very first time, will subject a federal grant request from a state agency to a cost benefit analysis,” said Atkins. “Before we say yes, we want to understand the long term costs.”   

In 2011, our Call 6 team found the Office of Federal Grants and Procurement under Governor Daniels spending hundreds of thousands of dollars without clear results .

In 2011, the OFGP website did not list a phone number, address or person in charge.

Instead, the website included a list of government liaisons that was so out of date, some of the contacts had not worked for the state in years and others told RTV6 they didn’t work with federal grants at all.

At least nine Republican lawmakers told Kenney in 2011 they had not heard of OFGP or did not know what it had been doing.

Records show OFGP spent about $600,000 since 2005, and the Call 6 team could not determine how those dollars helped secure more federal dollars for Indiana.

Kenney asked Atkins where OFGP failed.

“They were in a much different place than we are now,” said Atkins. “When Governor Daniels entered office in 2005 the state was broke. We find ourselves in a much different place today. The state’s in very strong financial condition and we have $20 billion dollars in reserves.”         

This summer, Indiana House Democratic leader Scott Pelath told RTV6 he’s skeptical OSBI will be any different.

"We saw an issue of neglect with the previous administration,” said Pelath. “You can call something whatever you want, but it's what you do once you've created the name."

Atkins denies it’s just a name change.

"The governor has really expanded the mission," said Atkins, who worked under Daniels from 2007 to 2011.

According to the Governor’s office, in 2012, the federal government collected $51.2 billion from Hoosier taxpayers and businesses.

“This year, 49 state departments and agencies will receive almost 20 percent of that money in the form of federal grants, stipends, and programs that often come with expensive, burdensome mandates and regulations that stifle ingenuity, cost Hoosier taxpayers and hamstring Hoosier businesses,” read a July 30 news release from the Governor’s office.

The new Office of State Based Initiatives aims to ensure Hoosiers are getting their fair share in return.


is working on a report detailing the impact of federal mandates on Indiana.

“Please note that OSBI will post a report including agency block grant contingency plans to its website by January 1, 2014,” said Denault in an email to Kenney. “This will be an annual report.”

The report will also be shared with Indiana legislators.

“We believe it will be a success,” said Atkins.  “David and his team will work with our congressional delegation to make them aware of these mandates.”

Atkins said when the report comes out it will be used as a “measuring stick” for OSBI’s success.

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