Indiana ends 2013 budget with improved cash balance

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Indiana's budget picture is a little brighter with news the state ended its last fiscal cycle with more money than expected.

Gov. Mike Pence on Thursday praised budget closeout numbers showing the state with $93 million in an ongoing surplus and $86 million more than expected in cash reserves.

"Our discipline when it comes to the state's financial management allows us to meet our budgetary goals as well as positioning our state for a solid financial future. That is something most states today would envy," Pence said.

The majority of the new money will be used to pay off bonds for the Miami Correctional Facility. Pence says the surplus would be best used to pay down debt left to him when he took office and save taxpayers money in the long term. The decision does not affect the state's automatic tax refund, which lawmakers reworked last year to only be triggered in budget-writing years.

Indiana ended its 2013 budget year at the end of last month and began its 2014 budget year on July 1. The budget closeout is an annual report of what the state actually spent versus what was budgeted, which is typically presented by the state auditor.

The improved budget picture comes shortly after lawmakers approved a $30 billion, two-year budget earlier this year with a modest income tax cut sought by Pence and more funding for roads and education.

House Minority Leader Scott Pelath, D-Michigan City, said the new number might sound good, but ignores the pain felt by most residents. He noted the surplus was built on deep cuts to services over the last few years.

"Our unemployment rate still remains around 8 percent," he said. "Families still are struggling to keep their heads above water. Our local schools still must grapple with doing more with less."

Former Gov. Mitch Daniels left office with sizable cash reserves and an ongoing surplus, built on a combination of improved tax collections, deep spending cuts and the 2011 discovery of a large tax error at the Department of Revenue.

Legislative leaders from both parties pushed this year to restore much of the funding for roads and schools that Daniels cut through the end of his term. Pence spent much of his first legislative session pushing instead for a 10 percent cut in the personal income tax.

But the governor shifted somewhat Thursday, saying the improved collections should go toward paying down debt he inherited.

Senate Minority Leader Tim Lanane, D-Anderson, attempted to play on one of Pence's top priorities, improved job training, in making a case that the money could be put to better use.

"By emphasizing prudent investment in job skills training, in a robust, statewide early education program, addressing backlogged local infrastructure projects and finding ways to curb the cost of attending college, we can take those needed first steps," he said.


  • Not States Duty
    Brad N......The reason the surplus isn't used for Police and Fire pensions is because that is not the states responsibility, it is the cities' who are responsible for paying that money into PERF. Firefighters and Police(except the state police) are not state employees,they are local government employees. So Avon, Fishers, Carmel, Greenwood, etc. have to pay that....not the state. By the way, the state PERF (public employee retirement fund) is pretty well funded rated second in the country to only Tennessee I believe.
  • Surplus should go to reduce Unfunded Pensions
    Why don't we use the Surplus to pay down unfunded pension liabs. on police and firefighters' pensions?

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  1. I could be wrong, but I don't think Butler views the new dorm as mere replacements for Schwitzer and or Ross.

  2. An increase of only 5% is awesome compared to what most consumers face or used to face before passage of the ACA. Imagine if the Medicaid program had been expanded to the 400k Hoosiers that would be eligible, the savings would have been substantial to the state and other policy holders. The GOP predictions of plan death spirals, astronomical premium hikes and shortages of care are all bunk. Hopefully voters are paying attention. The Affordable Care Act (a.k.a Obamacare), where fully implemented, has dramatically reduced the number of uninsured and helped contained the growth in healthcare costs.

  3. So much for competition lowering costs.

  4. As I understand the proposal, Keystone would take on the debt, not the city/CRC. So the $104K would not be used to service the $3.8M bond. Keystone would do that with its share.

  5. Adam C, if anything in Carmel is "packed in like sardines", you'll have to show me where you shop for groceries. Based on 2014 population estimates, Carmel has around 85,000 people spread across about 48 square miles, which puts its density at well below 1800 persons/sq mi, which is well below Indianapolis (already a very low-density city). Noblesville is minimally less dense than Carmel as well. The initiatives over the last few years have taken what was previously a provincial crossroads with no real identity beyond lack of poverty (and the predictably above-average school system) and turned it into a place with a discernible look, feel, and a center. Seriously, if you think Carmel is crowded, couldn't you opt to live in the remaining 95% of Indiana that still has an ultra-low density development pattern? Moreover, if you see Carmel as "over-saturated" have you ever been to Chicago--or just about any city outside of Indiana?