INDIANAPOLIS | April proved a cruel month for state tax collections, prodding Gov. Mitch Daniels to call for $1 billion in cuts to the nearly $30 billion state budget proposal lawmakers failed to pass last week.

"This is information that each legislator and each taxpayer needs to know," Daniels said Monday. "Regrettably in the month of April revenues were not as bad as we projected, they were worse. They were $255 million below the forecast made for the Legislature just over two weeks ago. That is a very large miss."

Using large charts to illustrate his points, the Republican governor said the worsening revenue picture proves lawmakers could not have hit their spending target without "obliterating" $1.3 billion in state reserves and setting up a future tax hike.

But Sen. Luke Kenley, a key GOP negotiator. said the budget that failed in the Indiana House -- amid a veto threat from Daniels -- included language giving the Republican governor plenty of authority to trim spending.

"I think he had the ability to get where he wanted to go," said Kenley, R-Noblesville. "I think we need to do what it takes to get 51 votes in the House and 26 votes in the Senate."

It's not certain how long a looming special session will last or when it will start, though June seems to be a consensus target. The current state budget runs through June 30.

Kenley said public hearings should be set if the governor wants to rein in education funding or make other substantial spending changes.

Daniels said the 2 percent average annual funding increases school districts would have received under the failed budget are a product of the "fantasy land" in which legislators reside. He said he knows of no other state contemplating an increase.

But Democratic House Speaker Pat Bauer suggested the level of spending restraint sought by the Republican governor would force teacher layoffs and more crowded classrooms.

"What he needs to do is write his own budget," said Bauer, D-South Bend.