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.

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Indiana Coronavirus Cases

Data is updated nightly.

Cases: 324537

Reported Deaths: 5594
CountyCasesDeaths
Marion44186858
Lake28094462
Allen18660301
Elkhart17663230
St. Joseph17256234
Hamilton13612170
Vanderburgh10028121
Tippecanoe896729
Porter855386
Johnson6718169
Hendricks6412158
Vigo625889
Monroe550450
Clark531078
Madison5239122
Delaware5075103
LaPorte481196
Kosciusko475941
Howard364177
Bartholomew335365
Warrick335372
Floyd329478
Wayne325678
Marshall311846
Cass303931
Grant287150
Hancock272957
Noble264946
Henry256437
Boone255054
Dubois245631
Dearborn228231
Jackson226334
Morgan221243
Gibson194926
Knox193021
Shelby192656
Clinton185421
DeKalb183932
Lawrence183849
Wabash172821
Adams172422
Miami170815
Daviess163145
Fayette153734
Steuben153414
Jasper151713
Montgomery149327
Harrison147624
LaGrange146131
Ripley145815
Whitley142314
Huntington133510
Decatur132543
Putnam131128
White131022
Wells130130
Clay130023
Randolph128121
Posey125816
Jefferson124116
Scott114520
Greene106053
Sullivan102716
Jay101913
Starke95022
Jennings90414
Spencer8908
Fulton87519
Perry85121
Fountain8228
Washington8127
Franklin73427
Carroll71913
Orange70028
Vermillion6607
Owen6468
Tipton60327
Parke6026
Newton57812
Rush5708
Blackford56612
Pike52719
Pulaski41815
Martin3705
Benton3643
Brown3574
Crawford3081
Union2782
Switzerland2655
Warren2562
Ohio2387
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