The Indiana State Budget
Contents
Introduction
Revenues,
Expenditures and Balances
Where Does
It Come From, Where Does It Go?
Recession and Revenue
Forecasts
The Budget in Recession
The 2003-05 Biennium
Introduction
Indiana's state government makes a lot of information
available about its state budget, but it's in a form that many people find
hard to understand. There are revenue projections from the State Budget
Agency, revenue reports from the Department of Revenue, budget bills considered
by the General Assembly, and lists of appropriations and fund balances from the
Budget Agency. State budget accounting is necessarily complicated.
Still, there ought to be a way to combine the revenue, appropriation and fund
balance information so everyone can understand.
The state's budget, after all, is not so different from a family's checking or savings account statement. The state starts the year with balances in its checking and savings accounts--the general fund and rainy day fund balances. During the year money comes in from various sources, mostly from taxes. During the year money goes out, in payments authorized by the budget which the General Assembly has passed. At the end of the year balances are left in checking and savings. If the state has spent more than it has taken in during the year, balances are lower than at the year's start. If the state has taken in more than it has spent, balances are higher. And, just as your bank objects when you bounce a check, so the Indiana Constitution requires that the state keep a positive balance in its checking account.
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Links to More Information |
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| To Find: | Go To: |
| A two-page handout about the Indiana state budget | This website: State Budget Handout (PDF file) |
| Information about the state budget, revenues and fund balances from the State Budget Agency | State Budget Agency website |
| Information about state taxes, other revenue sources, fund balances and the state budget from the Legislative Services Agency's Handbook of Taxes, Revenues and Appropriations | General Assembly website |
Revenues,
Expenditures and Balances
The Indiana State budget was in great shape in fiscal 1998, 1999
and 2000. Fund balances were near $2 billion at the start of each fiscal
year (July 1 of one year to June 30 of the next). Total revenues grew by
hundreds of millions each year, and so did expenditures. There were tax
cuts, special appropriations, and the state socked money away in the rainy day
fund. This budget summary table shows how good the good times were.
Indiana State Budget Summary, FY 1998-2003,
with Proposed 2004 and 2005
(millions of dollars)
| Actual | Actual | Actual | Actual | Actual | Est. | Propos. | Propos. | |
| 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | |
| Start of Year Balances | 1,844 | 2,055 | 1,991 | 1,638 | 910 | 534 | 494 | 286 |
| Revenues | ||||||||
| Sales Tax | 3,251 | 3,396 | 3,651 | 3,694 | 3,761 | 4,303 | 4,889 | 5,128 |
| Individual Income Tax | 3,435 | 3,699 | 3,753 | 3,780 | 3,541 | 3,698 | 3,839 | 4,033 |
| Corporate Income Tax | 1,016 | 1,044 | 985 | 855 | 709 | 550 | 561 | 581 |
| All Other | 781 | 801 | 810 | 794 | 784 | 1,441 | 1,527 | 1,578 |
| Total | 8,482 | 8,941 | 9,200 | 9,123 | 8,796 | 9,992 | 10,815 | 11,319 |
| Expenditures | ||||||||
| K-12 Education | 3,464 | 3,652 | 3,905 | 4,115 | 4,185 | 4,241 | 4,126 | 4,133 |
| Higher Education | 1,190 | 1,242 | 1,331 | 1,390 | 1,411 | 1,411 | 1,399 | 1,395 |
| Medicaid | 929 | 987 | 1,042 | 1,144 | 1,171 | 1,249 | 1,344 | 1,452 |
| Property Tax Relief | 870 | 963 | 1,057 | 1,154 | 1,180 | 1,731 | 2,306 | 2,415 |
| Health & Social Services | 654 | 659 | 757 | 774 | 858 | 855 | 793 | 794 |
| Public Safety | 524 | 524 | 621 | 623 | 678 | 681 | 667 | 682 |
| All Other | 882 | 1,093 | 1,015 | 990 | 824 | 896 | 698 | 690 |
| Total | 8,513 | 9,120 | 9,728 | 10,189 | 10,307 | 11,065 | 11,331 | 11,560 |
| Current Year Surplus/Deficit | (31) | (179) | (528) | (1,066) | (1,511) | (1,073) | (517) | (241) |
| Transfers from (to) Other Funds | (2) | (16) | 15 | 150 | 973 | 291 | 477 | 45 |
| Reversions | 215 | 87 | 134 | 103 | 145 | 421 | 25 | 185 |
| Payment Delays | - | - | - | - | 374 | 362 | 15 | 11 |
| End of Year Balances | ||||||||
| General Fund | 1,319 | 1,211 | 833 | 19 | 0 | 1 | 0 | 1 |
| Tuition Reserve | 240 | 255 | 265 | 265 | 265 | 265 | 265 | 265 |
| Medicaid Reserve | - | - | - | 100 | - | - | - | - |
| Rainy Day Fund | 496 | 525 | 540 | 526 | 269 | 228 | 21 | 53 |
| Total | 2,055 | 1,991 | 1,638 | 910 | 534 | 494 |