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Indiana governor seeks spending cuts with tax revenue drop

Eric Holcomb

Indiana’s state government agencies have been told to cut spending by 15% for the coming year in reaction to plummeting tax revenues during the coronavirus outbreak, the governor’s office said Friday.

Posted: May 22, 2020 1:44 PM

INDIANAPOLIS (AP) — Indiana’s state government agencies have been told to cut spending by 15% for the coming year in reaction to plummeting tax revenues during the coronavirus outbreak, the governor’s office said Friday.

State tax collections were about $960 million, or 44%, less than expected for April, and Gov. Eric Holcomb said the state could see a drop of more than $3 billion in tax revenue over the next 14 months.

“This is the first of what is likely to be a number of steps we’ll take to rein in state spending while we continue to provide critical government services to Hoosiers without interruption,” Holcomb said in a statement.

No cuts to school or university funding have been announced, although those areas saw significant cuts during the last recession in 2009-10.

A memo sent Thursday by Holcomb’s budget director to state agencies directs them to develop plans for 15% spending cuts during the new state budget year that begins in July. The (Fort Wayne) Journal Gazette first reported on the memo’s distribution.

Budget officials last month imposed a widespread hiring freeze for agencies that Holcomb oversees, such as the Bureau of Motor Vehicles, Department of Transportation, Department of Natural Resources and the state prison system.

“Unfortunately, we expect to continue to miss our revenue forecast for the remaining 14 months of this biennium,” Budget Director Zac Jackson said in the memo. “This projected loss of revenue puts a significant strain on the State’s financial resources.”

Holcomb said the planned cuts would help “maintain maximum flexibility to navigate a still very uncertain economic picture.”

“All options are on the table, and as we approach tax filing deadlines and better understand all of the federal funds available to Indiana, we will make more precise adjustments ahead of crafting a budget for next biennium,” he said.

Indiana Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 30901

Reported Deaths: 1964
CountyConfirmedDeaths
Marion9040531
Lake3191167
Cass15796
Allen121365
St. Joseph113234
Hendricks110365
Hamilton109291
Johnson1065102
Elkhart93827
Madison57658
Bartholomew46733
Porter46521
Clark45038
LaPorte38721
Tippecanoe3563
Jackson3531
Howard34417
Delaware34027
Hancock31527
Shelby31121
Floyd31138
Boone27935
Morgan25724
Vanderburgh2402
Decatur22131
White2128
Montgomery21114
Clinton2041
Harrison18321
Grant17820
Noble17420
Dubois1712
Greene16723
Warrick16326
Dearborn16221
Monroe15810
Henry1556
Lawrence14222
Miami1351
Vigo1357
Putnam1297
Jennings1264
Orange12222
Scott1153
Ripley1126
Franklin1068
Carroll882
Daviess8116
Steuben762
Newton7210
Wabash722
Kosciusko711
Wayne665
Marshall611
LaGrange592
Washington521
Jasper521
Fayette504
Fulton461
Rush452
Jefferson411
Jay410
Clay381
Pulaski380
Randolph373
Whitley342
Brown331
Sullivan311
Starke303
Owen301
DeKalb281
Knox240
Benton240
Crawford230
Perry230
Huntington222
Tipton221
Wells220
Switzerland190
Blackford191
Fountain172
Parke170
Posey170
Spencer141
Gibson132
Ohio130
Adams121
Warren121
Martin100
Union80
Vermillion80
Pike50
Unassigned0152
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