INDIANAPOLIS, Ind. (WLFI) - Governor Holcomb's finance team presented his budget proposal to the state budget committee Wednesday morning. The state legislature has to create a new budget every two years. The governor has four goals for the budget: to have a balanced budget, fund critical services to Hoosiers, restore and maintain prudent levels of reserves and maintain a AAA credit rating.
The governor's finance team is calling the state's financial situation "a pleasant surprise." The projections for Indiana's financial future last spring were much worse than what actually happened. They expect the state to be at pre-pandemic levels this year.
Half of the projected state revenue is expected to come through sales taxes. The next largest revenue source is income tax at 37.1%. Corporate tax will make up 4.7%.
Ever since the Red for Ed rally in November of 2019, public educators across state have been demanding an increase in funding from the state. Governor Holcomb has listened. According to the Indiana State Teacher's Association, he's asking for an increase of $377 million dollars in K-12 funding over the biennium. That's 49.9% of the his entire 2022-2023 general fund expenditure summary.
"Public education is half of our budget in the state of Indiana," said State Rep. Chris Campbell, (D) District 26. "No matter what, it is the most expensive thing that the state has to pay for, and it's the most important investment in our state needs to put money into."
It also restores the cuts made to higher education during the pandemic, and increases that funding by 2% over the next two years.
Purdue took the largest hit in state funding back in June, losing $3.2 million.
The pandemic has highlighted many important needs in Indiana, such as better broadband internet access in rural areas. This is something that is on Gov. Holcomb's agenda this year and is in his budget with $100 million dedicated to the cause.
Food, housing and health care insecurity are things Rep. Campbell will be looking for.
"I really want to what we are putting into Medicaid," she said. "With loss of jobs and incomes they are relying on these services to make sure that they have access to health care."
The finance team concluded on a high note. Indiana is one of 13 states that has maintained a AAA credit rating from all three major rating agencies. They said during the presentation that strong reserves, good fiscal management and low debt levels contribute to that rating.
The budget is just like any other bill that goes through the statehouse. It must be approved by both the house and the senate. Rep. Campbell expects things to be moved and changed between the governor's proposal and the final budget. News 18 will continue to follow the budget throughout the legislative session.