INDIANAPOLIS - Indiana has now socked away a $1.94 billion cash reserve, Gov. Mike Pence and state Auditor Tim Berry said Thursday.
The two laid out the state’s financial shape as they closed the books on fiscal year 2013, which ended on June 30. Pence said Indiana brought in a structural surplus of $483 million over that period – $93 million more than lawmakers had expected.
That’s not enough to trigger the “automatic taxpayer refund” that last year netted individual income tax filers credits worth more than $100 each. But Pence said it did allow him to spend $66 million to pay off the bonds for the Miami Correctional Facility, which he said will save taxpayers $27 million in debt payments over time.
He touted the individual income tax cut he got the General Assembly to approve this year – one that lowers the state’s 3.4 percent rate to 3.3 percent in 2015 and then to 3.23 percent in 2017 – and said the strong balance sheet shows that it was the right decision.
“Indiana is strong and growing stronger, and the closeout report confirms the balanced approach that we took in the enacted budget,” Pence said.
Democrats, though, said the reserves are meaningless. They complained that Indiana instead ought to spend more funding K-12 public schools and pursuing a Medicaid expansion, as envisioned in President Barack Obama’s health care law.
“The leaders of our state worship these surplus numbers like they are ends in and of themselves. The fact is that these numbers only matter to the extent that our people are prospering. In that context, these numbers mean nothing,” said House Minority Leader Scott Pelath, D-Michigan City.
“Our unemployment rate still remains around 8 percent. Families still are struggling to keep their heads above water. Our local schools still must grapple with doing more with less. Thanks to the stubbornness of our leadership, too many families still must rely upon the emergency room as their only health care option.”
Pence, though, touted the reserve as critical to Indiana’s economic future. He said companies are interested in the state’s finances when they consider where to locate new operations.
“It is a lead selling point for the state of Indiana. It is an asset to all of our businesses and it is directly related to job creation,” he said.
The Indiana General Assembly adopted a new two-year, $30 billion budget this year, and that budget took effect July 1.