State Ends Fiscal Year With $500 Million Surplus, Promises Rebates For All

Indiana taxpayers will receive a $100 rebate next year after the state ended the fiscal year with a $500 million surplus and $2 billion in reserves. Gov. Mitch Daniels touted the budget announcement today, but he doesn't say what his plan is for repaying the federal government over $2 billion it is owed because our state's unemployment trust fund went broke more than two years ago and began borrowing money the federal government doesn't have to pay unemployment benefits. The governor deflected questions about that unpaid debt on the basis that the money that funds the unemployment trust fund comes from a different pot of money--namely, taxes on employers. Under the plan announced today, taxpayers will receive $300 million in refunds and the state's pension funds, which are among the worst unfunded state pension systems in the country, will receive a $300 million cash infusion. Earlier in the fiscal year, in two separate announcements, the governor announced the state found about $500 million in state revenues that had been misplaced. An external auditor has been hired by the state to figure out how the mistakes were made. At least we don't face the budget catastrophes faced by other states like neighboring Illinois, which face budget deficits in the billions of dollars.