INDIANAPOLIS | Indiana spent $210.4 million less than it took in during the 2015 budget year that ended June 30, growing the state's reserve funds to a near-record $2.14 billion.
"It should be an encouragement to every Hoosier that after making critical investments in education, in infrastructure and in other priorities, the state of Indiana remains on a sound fiscal foundation," said Republican Gov. Mike Pence.
Data released Thursday by Republican State Auditor Suzanne Crouch show Indiana collected $15.145 billion in tax and fee revenue between July 1, 2014 and June 30.
State appropriations and additional unbudgeted spending totaled $15.184 billion — a deficit of $39 million.
However, the budget year ended with a 2.72 percent surplus because Pence directed most state agencies to hold back and revert up to 4.5 percent of their appropriations, reducing spending by $133.3 million.
Indiana also was not forced to spend the $115.4 million annually required to be set aside to backstop sales tax-supported borrowing for Indianapolis' Lucas Oil Stadium and the Indiana Convention Center.
"By continuing to live within our means, maintaining a solid structural surplus, identifying areas of potential growth and funding Indiana's priorities, we ... ensure that Indiana remains the fiscal envy of the nation," Crouch said.
Hoosier Democrats questioned why the GOP governor and Legislature seem determined to grow a budget reserve already topping $2 billion when there are plenty of unmet needs across the state.
"What continues to stand out about these yearly announcements is the absolute lack of ambition our Republican leadership shows in anything except squirrelling your tax dollars away," said state Rep. Greg Porter, D-Indianapolis, the top Democrat on the budget-writing House Ways and Means Committee.
Porter said with so much money set aside, the state easily could double funding to local governments for road construction, work on badly-needed flood control projects, expand the preschool pilot program beyond five counties and still have more than $2 billion in the bank.
"It would help some people now rather than have us wait until later, when a crisis erupts and we finally decide we have to do something," Porter said.
The governor stressed that as a conservative he is cautious about spending generally. He's also concerned that recent growth in Indiana's economy, and corresponding increases in sales and income tax revenues, might not be long-lasting.
"I think it's altogether appropriate to be proactive and I think that's, in part, responsible for why we're in the strong fiscal position we are in today," Pence said. "Every Hoosier can be assured that we will continue to work tirelessly to ensure that the needs of our citizens are met."
Pence hinted that if revenues in the early months of the 2016 budget year remain robust, he may be willing to spend approximately $250 million from the reserve to pay off Indiana's lingering unemployment insurance debt to the federal government.
That would remove a potential impediment to hiring as Hoosier businesses no longer would be charged a $105 per employee penalty, set to grow to $126 next year, to make up for their underfunding of the state's unemployment trust fund prior to the Great Recession.
"I'm not committing to that but if revenues hold or exceed projections, given the magnitude of the reserves that we have we think it may be possible," Pence said.
At the same time, Hoosiers will not be getting an automatic taxpayer refund.
Recent changes in how the refund trigger is calculated make it near-impossible for the state to ever again hit the reserve threshold that in 2013 resulted in a $111 per person income tax credit.