How does your family budget for the year? Do you sit down around the kitchen table every week discussing your financial situation or set a yearly budget and then adjust accordingly? Like every Hoosier family, lawmakers follow similar budgeting principles; the only major difference is that the budget is crafted in a committee, known as Ways and Means, instead of around the kitchen table.
The General Assembly is tasked with crafting and enacting the state’s budget every odd-numbered year. For House Republicans, crafting an honestly balanced budget, without raising taxes on hard-working Hoosiers, is one of our top priorities this session. We have a proven track-record of fiscal integrity, which has led to a strong, robust economy. Our goal to continue managing Indiana’s finances responsibly to provide greater financial security for future generations, which starts by maintaining our healthy reserves and a strong structural surplus.
Having a structural surplus means that Indiana’s ongoing financial commitments does not exceed the revenue collected for a given fiscal year. In other words, we spend less than we take in. The 2014 fiscal year finished with a $107 million structural surplus. Building a prudent structural surplus helps the state maintain a structurally balanced budget, even if revenues do not come in as planned.
Equally important, we also need to maintain our healthy reserves, which is another way of referring to Indiana’s savings account. Indiana finished fiscal year 2014 with $2 billion in reserve balances, and while this might sound like a lot, it is only enough to run our state government for about 48 days. Not only do healthy reserves allow us to have the highest possible bond rating, but it is also our safety-net in case another economic downturn occurs.
However, K- 12 education funding accounts for half of Indiana’s biennial budget and is nearly two-thirds of the budget when higher education is included. House Republicans have a proven track record for putting education first and are continuing to make that a priority this session.
Part of our focus on education this session is fixing the funding formula to better appropriate the funds across the state of Indiana. The foundation amount is the starting point for the school funding formula and is essentially the minimum guarantee for each student. The current foundation amount is $4,587 per student for the 2015 fiscal year. Adjustments to the foundation amount per-student is based on multiple factors including the number of: low-income students, special education students, career and technical education students and of honors diplomas awarded.
The statewide average for per-student funding for the 2014 fiscal year was $6,579, the lowest per-student funding level is $5,463 and the highest is $8,666. With the highest per-student funding nearly 40 percent above the lowest level, we are working to not only raise the foundation level of dollars going to schools, but also working to fix the funding formula to increase equity in spending.
Along with strengthening our education system, we are also working towards continued government reduction and efficiency. It is vitally important that we continue to look for ways to cut government waste, and with a faster, more efficient government, Hoosiers can receive the services they rely on more expeditiously.
Looking back, we have eliminated more than 70 government boards and commissions, more than 600 government appointments, eliminated nearly 2,000 lines of Indiana Code and have a long history of tax cuts. Cutting back on government spending means more money appropriated back to the state and back to you, the taxpayers.
I look forward to working with my fellow legislators to discuss our budget and the funding formula to eventually pass it with confidence. It is important for us to make sure we are diligent and effective in our work to stay accountable to all Hoosiers.
Rep. Ubelhor (R-Bloomfield) represents the majority of Greene County and portions of Monroe, Martin and Daviess counties. He serves as a member of the Ways and Means, Public Policy and the Natural Resources committees.