INDIANAPOLIS -- Gov. Mitch Daniels gave the Indiana Legislature a passing grade Monday for what he considers doing no harm to taxpayers and not increasing state spending, but urged voters to oust House Speaker Pat Bauer to continue progress in the future.

Daniels praised lawmakers for letting voters decide on permanently capping property taxes and for giving schools flexibility to move around money from unused accounts.

The governor also endorsed the one-year delay of the increase in the tax on business that pays for unemployment benefits, even though that will put the state deeper in debt to the federal government.

But Daniels said the outlook for public school funding next year will be "extraordinarily difficult" unless the national economy shows significant improvement.

He said the job would be easier if Hoosiers gave Republicans control of the house, 6News' Norman Cox reported.

"Speaker Bauer's an expensive date sometimes. He believes in a lot more spending," Daniels said. "They tried to spend, you will recall, more than $1 billion extra just a few months ago. Think what a fix we'd be in if we had surrendered to that."

K-12 education in Indiana already has faced $300 million in reduced state funding this year as the state has cut spending in the face of lower tax revenues.

But Daniels on Monday said Indiana has only "nicked" school funding instead of "gouging" it like other states. He said the state's priorities will be to maintain fiscal solvency and its AAA credit rating over the next 10 months before lawmakers start writing a new state budget.

With the session concluded, Daniels said he will turn his full-time effort to cutting spending to keep the state in the black.