INDIANAPOLIS – Indiana’s revenues grew faster in May than expected, painting a rosy picture for the state’s economic recovery following the fallout from COVID-19.
According to the latest state report, released Friday, the General Fund revenues for May totaled $1.878 billion, $518.8 million (or 38%) more than predicted in the April 15, 2021 forecast and nearly double what the state received in May 2020.
The report said that overall, the changes are likely due to “… changing restrictions related to the pandemic, vaccine development and distribution, and recent federal policy actions on assistance programs, economic impact payments, interest rates and more.”
Specifically, sales taxes, individual income taxes, corporate adjusted gross income tax and gaming taxes were collected at higher rates and are “trending at multi-year highs.”
With an estimated $3.397 billion more in the General Fund, $617.9 million more than predicted just the month before, some Democratic budget writers are calling for an “impactful” infusion and increased spending.
“Another half a billion dollars could remain hoarded in a bloated state surplus if my colleagues across the aisle do not take the opportunity to thoughtfully invest these taxpayer dollars back in our communities,” Rep. Gregory Porter, D-Indianapolis, said in a release. “A decade of ‘small investment’ and ‘small government’ policy is leaving our state ‘too small’ to work for everyone.”
Porter, the ranking Democrat on the House Ways and Means Committee, which writes the state’s two-year budget, criticized Republican budget writers in April for being too frugal and favoring corporations over working class families and small businesses.
Porter referred to the uneven recovery of state finances versus “Main Street” small business, which he said continued to struggle.
Research has suggested that the economic recovery will affect the wealthy and impoverished differently, with enriched individuals prospering at the expense of mostly Black and Latino low-wage workers.
“I am imploring my colleagues to take any of the $500 million that exceeds the SFY 2021 forecast into a temporary holding account in the Indiana Treasurer of State’s office, along with the $200 million in tuition support money,” Porter said.
“When the Indiana General Assembly reconvenes for a special redistricting session in the fall, an opportunity will present itself for legislators to allocate this newfound money in a bipartisan way that benefits all of our constituents.”
COVID-19 disrupted the one-in-a-decade redistricting process, delaying the census counts until late fall, rather than winter. Legislators left Indianapolis in mid-April intending to return in the fall and redraw districts.
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