The 1989-91 biennial budget recommendations for Indiana institutions of higher education are presented in three parts: (1) an overview; (2) a review in detail; and (3) a section of supporting documentation. Part I includes discussions about the demographic changes in the workforce of Indiana, the relationship of education to productivity, and higher education's response to these recommendations as well as specific funding suggestions for 1989-91. Part II provides a detailed review of the budgets submitted by each university in their response to the educational objectives of the Commission and includes sections on the budget review process, university operating budgets, university line item budgets, university capital budget recommendations, State Student Assistance Commission budget, and postsecondary technical education funding recommendations. Part III contains 13 appendixes including materials on: higher education planning initiatives for 1988, Indiana's higher education performance compared to state-level performance objectives, recommended improvement projects, recommendations on use of Perkins funding, the consolidated cash budget recommendations for the 1989-91 biennium, and the list of institutional priorities and requested amounts. (DB)