INDIANAPOLIS – A state forecast shows economic growth is slowing down, but lawmakers will still have additional funding they can use in the new budget.
Projections unveiled at a state budget committee meeting Thursday show Indiana lawmakers will have $1.6 billion in new funding to spend in the next two-year budget.
But State Sen. Ryan Mishler (R-Bremen), who chairs the Senate Appropriations committee, told reporters spending requests are adding up quickly.
“Just the agencies alone have asked for over $700 million, which is more than a $600 million increase,” Mishler said. “And we haven’t even discussed member requests, K-12 tuition support or higher ed.”
According to the State Budget Agency, Indiana’s surplus is currently close to $4 billion.
That comes after lawmakers refunded taxpayers $1 billion during the special session and approved a tax cut package, including an income tax cut and the elimination of the utility receipts tax, earlier in the year.
But lawmakers can’t use all of the surplus in their next budget, Mishler said.
“There’s three buckets that we don’t touch, and that’s the Medicaid reserve, the tuition reserve and the rainy day fund,” he said.
Mishler said it’s uncertain exactly how much lawmakers will be able to increase public health funding. Earlier this year, a commission called for $240 million per year in additional state spending.
“I think we have more than what we anticipate,” said State Rep. Greg Porter (D-Indianapolis), ranking minority member on the House Ways and Means committee.
Porter said he wants to make sure funding for education and public health remain a priority.
“In order to have a strong economy, you got to have a good workforce, and the workforce does have to do with health,” Porter said.
Porter said he’s concerned some tax cuts already approved earlier this year, such as the elimination of the utility receipts tax, may have cost the state valuable funds.
Still, Republicans aren’t ruling out more tax cuts this session. Mishler said it’s a balancing act.
“When you cut taxes, you reduce revenue,” Mishler said. “So it depends on what you want to spend.”
