The Crusader Newspaper Group

Republican Leaders Hold $2 Billion in Tax Reserves

By Giavonni Nickson

Senate Democrats were outraged this past session when important line items were dropped from the state budget, as Republican leaders decided to hold $2 billion in tax reserves instead of allocating funds toward raising teachers’ pay and other line items on the state’s priority list.

Indiana has a two-year budget cycle where legislators craft a state budget in every odd-numbered year. This past session, the new state budget became partisan as the session progressed. The state budget is a clear declaration of the state’s priorities.

These items were originally promised to be funded in a bipartisan manner, yet in the final days of voting, Republican leaders removed these projects and ideas with no explanation.

Some of the items removed from the budget include:

  • Relief programs for Hoosiers who are unable to pay interest fees on property taxes
  • Funding for the Mortgage Foreclosure Program to help Hoosiers keep their homes
  • Funding to give teachers across the state a 5 percent raise to their base pay.
  • Money to address massive erosion problems that plague lakeshore communities in Northern Indiana
  • Mandatory adoption subsidy payments for special needs children to assist foster parents upon adoption
  • Funding for doula services to help lower infant mortality rates

Instead of allocating funding, Republican leaders decided to hold taxpayer money in a reserve account and tout $2 billion in excess funds.

Senate Democrats argue that having billions of dollars in reserves is excessive while refusing to address any of the  significant issues that could be solved with well-funded programs is a disservice to all Indiana residents.

Republicans have hoarded taxpayer dollars, and instead of using the money to help Hoosiers or return any excess, they keep it in a “reserve” account and never touch it. All the while, Indiana has a high infant mortality rate and the lowest rate of teacher pay growth in the country. Teacher pay in Indiana still ranks lowest among all states in the Midwest and there are currently over 26,000 children in the foster care system across the state.

At the beginning of July, the governor announced that the state now has over $400 million more in unexpected surplus and that taxpayer dollars would pay for projects already funded in the state budget with the rest going back into the reserve. Democrats are calling this a clear case of partisan fiscal irresponsibility.

There is still time for positive fiscal change. Because the governor wants to fund items already in the budget, the legislature must re-open the budget bill and vote once more. That means next session there is a rare opportunity to right these past wrongs and get the state to pay for things Hoosiers actually want and need.

Residents in Gary and across the state are urged to exercise their right to call their senators, representatives, and governor to voice their concerns on their tax dollar utilization.

Giavonni is a passionate freelance writer native of Gary IN. She covers business, politics, and community schools for the Chicago/Gary Crusader.

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