(Indianapolis, Ind.) – Indiana’s newfound $1.2 billion surplus was welcome news delivered yesterday by Indiana State Auditor Tim Berry.
The fiscal year ended June 30 with the state having $400 million, or 40 percent more money in its coffers than it had at the same time last year.
Berry said it's an example to Washington, D.C. that budgets can be reigned in.
“We’re showing quite the opposite in showing that you can manage a budget by reducing expenditures and not raising taxes,” said Berry.
Barry credited state agencies who slimmed their spending and Governor Mitch Daniels’ fiscal accountability.
“More money in Hoosiers’ incomes and a terrific job of cost control by state employees working together combined to produce an even stronger result than we expected at budget time,” Daniels said in a statement Thursday. “With the national economy still limping badly, and downside risks still abounding, it is reassuring to have a safety margin that other states would love to have.”
Twelve months ago, lawmakers and the governor were concerned the state was going to go broke by the end of the fiscal year. Now, the state has an amount in reserves that was not predicted to be reached until 2013.
Indiana arrived at its surplus despite receiving 5.5 percent less revenue, or $1.34 billion, that was anticipated in the 2010-2011 fiscal year from the budget passed in 2009. At the same time, the state found ways to spend 5.5 percent less, or $1.52 billion than expected.
Democrats were not as jubilant as the auditor and governor.
“From even the most cursory examination, it is apparent that this budget surplus has not been built on a strong economy keyed on job creation,” said House Minority Leader Pat Bauer (D-South Bend) in response. “That’s because this administration has no such program.”
“Instead, it is obvious that this surplus owes a great deal to budget reversions and other accounting tricks that this administration frowned upon when it took office. Without the past use of federal stimulus dollars, the continual demand for trimming agency budgets, and the occasional raid on dedicated funds, our financial picture would not be as rosy as the governor and the auditor would like. At that point, it is prudent to wonder at the cost extracted by these gimmicks. What services are suffering as a result of the obsessive need to maintain a $1 billion surplus?” Bauer said.
The $1.18 billion surplus does not meet the 10 percent budget surplus amount that would result in an automatic taxpayer refund which state lawmakers passed earlier this year. The state expects to come close to that at the end of the current two-year budget cycle.