INDIANAPOLIS (AP) — An Indiana Senate committee stripped some major provisions Tuesday night from legislation that ultimately would have required schools to hold back third-graders if they can’t read at their grade level.

The Senate Appropriations Committee also voted to remove language in a bill that would have allowed casinos on Lake Michigan and the Ohio River to move inland.

Both amended bills passed the committee and moved to the full Senate.

Under the original reading bill — one of Gov. Mitch Daniels’ top initiatives — youngsters who cannot read at the third-grade level by the time they finish third grade would not move on to the fourth grade starting in the 2012-13 school year. Exemptions could be made for certain students, such as those with disabilities or those who have been held back for two or more years.

The bill required intensive intervention for those held back, such as providing 90 minutes of uninterrupted reading instruction daily through small groups, extended school days or other means. That alone could cost more than $23 million, according to the Legislative Services Agency, the General Assembly’s research arm.

Senate Appropriations Chairman Luke Kenley, R-Noblesville, is among legislative leaders concerned about passing any bill with significant costs as Indiana’s government faces fiscal woes.

He won approval of an amendment that would require the Department of Education and Board of Education to create reading and third-grade retention programs on their own.

Kenley said if the department and board think the programs they develop cost money, they could return to the Legislature next year to seek funding. If they believe the programs can be implemented without additional funds, they can move forward.

“The bill was so specific as to its instructions that ... it created an actual fiscal impact,” Kenley said of the original bill.

The provision removed from the gambling measure had its supporters, who said allowing riverboat casinos to move inland would have helped stave off competition from gambling expansion in neighboring states.

But some casinos opposed the bill, fearing they could lose business to rival in-state casinos that move inland.

The Casino Association of Indiana, which represents 12 of the state’s 13 casinos, had asked for the land-based issue to be delayed for at least a year. It said four of its member casinos supported allowing riverboats to move inland, and eight were opposed.

“We got some pretty negative signals and pretty negative comments regarding efforts to deal with this issue,” Kenley said. “I personally think we’re making a pretty big mistake not going forward with that, but I didn’t want to jeopardize other elements of the bill.”

Those include provisions designed to help casinos at the state’s two pari-mutuel horse-racing tracks as well as a casino in southern Indiana’s Orange County.

Sen. Earline Rogers, D-Gary, said she was disappointed that the land-based provision was removed. She supports a push to have one of two Gary riverboat casinos moved inland to a major intersection of freeways in Gary, saying it would attract more customers and bring more tax revenue to the state.

She noted that people in Ohio voted in November to allow four casinos in that state, and said Indiana should act now to help stave off out-of-state competition.

“This window of opportunity might not be available next year,” she said, adding that she would try to get the land-based provisions restored in the bill.

Posted 1/27/2010