2026 Innovation Issue: Smart manufacturing grant program boosted sector
Demand for the program was exceptionally high, and funds were exhausted each year. But the Legislature didn’t fund the program in the state’s current budget.
State Budget
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Indy-based, foster youth-focused nonprofit faces $600K state, federal funding loss
The cuts, which represent about 12% of Foster Success’ budget for its Indiana programs, will curb access to basic needs assistance, education and job training, financial empowerment and networking.
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UPDATE: Lawmakers expect ‘tough’ budget cuts to offset $2.4B drop in projected revenue
An updated revenue forecast presented to the Budget Committee projected the state’s revenue will flatline from 2025 to 2027.
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Republicans reject cascade of Democratic amendments to budget
The body opted to accept just three changes to House Bill 1001. Another 60-plus amendments, mostly from the chamber’s 10-member Democratic caucus, were rejected.
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Soaring Medicaid expenses foreshadow tough decisions but Braun says he won’t cut program access
Lawmakers are holding their collective breath in anticipation of Dec. 17 forecasts for tax receipts and Medicaid needs that will determine how they’ll proceed with writing the state’s next two-year budget and funding priorities like education.
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Articles
Judge hears motions in Indiana University trustee lawsuit
The American Civil Liberties Union of Indiana argued that a last-minute provision to the state budget unconstitutionally singles out IU by removing the ability of alumni to directly elect trustees.
State Budget Committee approves toll road hikes, child care boost
The panel green-lit a deal letting the Indiana Toll Road’s private operator to raise rates twice annually and the governor’s request to spend $200 million expanding a frozen low-income child care program.
2025 Year in Review: Revenue shortfall strains budget
The final budget boosted the tax on cigarettes by $2 per pack, with similar hikes on other forms of tobacco. Those tax increases were expected to generate $850 million over the two-year budget cycle.
New forecast shows big growth in Indiana surplus
Despite Thursday’s positive forecasts, Republican state fiscal leaders showed no signs of any spending boosts for the tight budget that took effect July 1.
Panel hears warnings on rising Indiana prison population, local corrections funding shortfalls
Indiana lawmakers heard stark warnings that the state’s prison population is again nearing capacity while funding for local alternatives is shrinking.
Indiana agencies cut staff, contracts as mandatory spending plans roll in
A grim May revenue forecast prompted lawmakers to cut most agency appropriations by 5% in the latest budget—and authorized the State Budget Agency to withhold another 5%.
Indiana slashing reimbursement rates for child care providers
Child care providers around Indiana will see reimbursement rate cuts of 10% to 35% as the state’s Family and Social Services Administration tries to close a $225 million funding gap.
Braun: Administration saved $38M in first 6 months, cut $72M from future spending
Indiana Department of Administration Commissioner Brandon Clifton told reporters that the direct savings would likely be reverted to the General Fund.
Indiana agencies outline spending cuts in pursuit of 5% reserve
A grim May revenue forecast prompted lawmakers to cut most agency appropriations by 5% in the latest biennial budget—and authorize the State Budget Agency to withhold another 5%.
State agency plans aggressive new budget method to control growing Medicaid costs
Over the course of a decade, Indiana’s per-enrollee costs for certain Medicaid recipients are expected to surge by 43% and 72% for lower-income and elderly Hoosiers, respectively.
Analysis: Latest Indiana budget drops spending 7%—with cuts ‘telling’
The $54.6 billion budget, approved in May, spends 3% more than its 2023 predecessor. But the state’s spending power has sunk 5% since then.
UPDATE: Fiscal leaders confident in Indiana’s finances with reserves at $2.5B
Reserves will be 11.2% of Indiana’s spending, at the lower end of the 10-15% recommended to maintain Indiana’s AAA bond rating.
State budget cuts impact Indiana alternative schools
Amid state budget troubles, alternative schools lost more than $4 million in funding.
Indiana could miss out on hundreds of millions of federal funds under megabill
Some of the biggest funding reductions in the bill—like Medicaid reform—will be phased in, meaning it won’t immediately hit Indiana’s coffers.
Cigarette, gas tax hikes coming to Indiana on July 1
The cigarette tax hike is the result of a last-minute compromise by Indiana legislators to address a projected revenue shortfall of $2 billion over the biennium.
Indiana workforce leaders aim to ‘salvage’ slashed dropout prevention program
The Jobs for America’s Graduates program, which serves thousands of Hoosier students, was eliminated as a line item in the state budget during this legislative session.
50+ state employees—including IEDC workers—laid off as Indiana cuts take effect
The Governor’s Office confirmed that agencies under both the education and commerce verticals announced staff reductions on Tuesday. The Indiana State Museum also let go of several employees last week.
State agencies instructed to withhold funds on top of 5% budget cuts
The directive follows a grim revenue forecast earlier this year that projected the state would have $2 billion less to spend in the next two-year budget, prompting lawmakers to institute 5% agency cuts largely across the board.
Funding for workforce training, manufacturing readiness and flight incentives in limbo after state budget cuts
Business leaders are encouraging state commerce officials to retain the programs that have led to what they say has been a “strong ROI” in the past.