INDIANA FISCAL POLICY INSTITUTE |
PUBLICATIONS
2024
2024 Legislative Session Wrap-Up
2024 Legislative Session - Short Session Ends With Focus on Workforce Development, Education. Fiscal Issues On Hold Until 2025 -The Indiana General Assembly adjourned the “short” session on the evening Friday, March 8, 2024. While the session was labeled as short, that does not mean it was uneventful. A total of 756 bills and resolutions were introduced. In the final analysis, only 172 were passed and sent to Governor Holcomb for his signature. That is still a fair amount of legislation to be passed in a short ten weeks. For his part, the Governor only vetoed one bill, an education bill containing anti-discrimination language. On the tax side, only minor tweaks to local income taxes and property taxes were passed, most making little discernable impact. Several local food and beverage and Innkeepers’ taxes were approved, as well as administrative bills from the Department of Local Government Finance and the State Board of Accounts. These bills will certainly impact local government finance officers, but will be little noticed outside of fiscal experts. Read more here.
HEA 1002 (2023) - A New Hoosier Education Model
A Brief on the Opportunities and Challenges Around this New Uncharted Model for Education - In 2023, Indiana passed House Enrolled Act 1002. Legislators in support of the bill touted it as an opportunity to “reinvent high school” in Indiana by melding youth apprenticeships and work-based-learning opportunities with a school choice funding mechanism. As Indiana, like many states, continues to battle a growing labor shortage, building a talent pipeline in high school is a strategy that many states are embracing. This brief is the first of a series on Indiana’s emerging commitment to youth talent development and how it intersects with the growing school choice movement and interest in youth apprenticeship and work-based-learning in the Hoosier state. The brief touches on some of the barriers to the success of the program, and how those might be addressed in the years to come. Read more here.
Pre-Legislative Session Fiscal Brief
Starting Session with a $1.5 Billion “Surprise”, Indiana Dips Below 10% Reserve for First Time Since Pandemic - The Indiana General Assembly returns next week on January 8, 2024, for a “Short Session”. Historically short sessions do not include the development of a traditional state budget, but there are fiscal issues that arise. This year, there are a few complications, laid bare in last month’s revenue forecast presentation to the State Budget Committee, that fiscal leaders will be forced to discuss. These include an unexpected overspend of $1 billion in Medicaid spread over state Fiscal Years (FY) 23-25 and a revised revenue forecast that reduced anticipated revenue collection by $500 million – these two factors combined to drain quite a bit of Indiana’s state reserves. Read more here.
2023
IFPI Interim Study Committee Wrap-Up
2023 Legislative Interim Study Committee Wrap-Up - As the Indiana General Assembly prepares for a new 2024 legislative session, they are wrapping up the work that was done this Summer and Fall vis a vis interim study committees. Each year, these committees study a wide variety of topics, often making recommendations for legislation to be considered by the full General Assembly to take up when it is next back in session. This year was no exception, with several fiscal policy relevant committees meeting and weighing in on important public policy issues. Read more here.
IFPI Hoosier Talent Snapshot
2023 Hoosier Talent Snapshot - Indiana's consistently tight labor market continues to be one of the primary challenges for Hoosier policy makers. The IFPI 2023 Hoosier Talent Snapshot is a primer for those who need more information on the challenges to building a talent pipeline, as well as potential opportunities to overcome barriers to work. Read more here.
IFPI FY Closeout Report
FY 2023 Close-Out Report - Back to Baseline - The State of Indiana closed the books on the fiscal year on June 30, 2023. On July 13th, fiscal leaders announced the state of Indiana’s balance sheet. Overall, increased consumer spending that spiked revenues in 2022 returned to baseline – Indiana raised $21.6 billion in revenues in the fiscal year, which is 0.7% over revenues for the previous year. Spending totaled $18 billion, an increase of 2.4% over the previous year. This normalization of revenues brings Indiana back within a typical (pre-Covid) range. The surplus of $2.9 billion is also more in line with historic averages. Read more here.
IFPI Legislative Recap
Indiana's 2023 Legislative Session - A Brief Summary of a Session Long on Fiscal Impact - On April 28, 2023, Indiana passed a balanced $44.6 billion biennial budget that maintains healthy fiscal reserves, pays down pension debt, increases K-12 funding, and accelerates already planned decreases in the state's individual income tax rate. Other bills that impact Indiana's fiscal health also passed this Session. A high-level summary of the most pertinent legislation is outlined here.
2022
2021
Indiana's Local Income Tax: Distributions and Balances in Recession and Expansion
Dr. Larry DeBoer - Professor Emeritus of Agricultural Economics, Purdue University
How does Indiana fund local government – police and fire protection, street repairs and stormwater systems, the essential services and routine amenities closest to the daily lives of Hoosiers, delivered by counties, municipalities and other local taxing units like townships and library districts?
2020Capacity-Cost Indexes of Indiana Local Governments - 2002 & 2018, 2020Even before COVID-19 reached Indiana to create widespread economic disruption and decline, local governments in the places where most Hoosiers live and work had been grappling with growing budgetary pressure even during the decade of recovery from the Great Recession of 2008-2009. In 2019, the Indiana Fiscal Policy Institute (IFPI) asked Dr. Larry DeBoer of Purdue University to revisit and expand an earlier analysis of local government fiscal climate. This resulting study, “Capacity-Cost Indexes for Indiana Local Governments – 2002 & 2018,” analyzes the economic, demographic and policy changes contributing to a divergent pattern of revenue capacity and service costs across urban, rural and mixed (suburban and industrial) communities. Professor DeBoer details how fiscal stress has increased in urban counties, as revenue potential also fails to keep pace with costs in many of the state’s fastest-growing areas. He explores the negative effects of manufacturing losses on industrial counties that have failed to diversify, and the revenue stability that agricultural assessment and tax policies have brought to rural counties since 2002. As the COVID recession reduces revenue capacity statewide, we believe the report also acts as a roadmap to areas likely to be hardest-hit by a sharp downturn, accelerating the longer-term challenges of a tax base limited by a combination of policy choices and economic trends. IFPI is pleased to partner again with Larry DeBoer, sharing vital insights from one of Indiana’s foremost experts on state and local tax policy. 2019A Fiscal History of Indiana Local GovernmentIFPI Report by Craig Johnson & Justin Ross Over the last 40 years the fiscal structure of Indiana’s local governmental units has showed remarkable consistency up until the early 2000’s. On the revenue side much of the recent changes are fully consistent with the foundation laid by the Bowen tax package in 1973 - property tax relief; an expansion of local government authority to generate revenue from local income taxes; and an increase in the state sales tax to fund local services, programs and provide additional property tax relief. A structural shift in real own-source local government revenue began in 2004, as shown in Figure ES.1. Local income tax revenues took off and did not stop increasing until 2010. |
2017
Revenue Forecasting: Indiana's Method and the Results It Produces
Indiana's Public Pensions
When it comes to understanding the fiscal health of state pension funds, the popular measure is the unfunded liability. Yet there are many other measures that provide a more complete look at the health of state pensions and how it affects those who depend on the benefits—and the taxpayers who foot the bill. This report provides a more detailed look into Indiana’s public pension plans through the two largest—the Teacher’s Retirement Fund and the Public Employees Retirement Fund. What we find is a well-funded PERF and an improving TRF, but significant challenges that remain, especially for local governments and school corporations as the share they’re asked to pay has grown.
2016 |
Funding Indiana's Roads for A Stronger, Safer Tomorrow
The Task Force believes Indiana’s road transportation system is underfunded, there is an immediate need to upgrade the interstate, state and local roads/bridges and that it will require increases in taxes and other user-related fees to pay for the improvements. Several members of the Task Force estimated the need for new funding is about $1 billion per year.
The Fiscal Health of Indiana's Larger Municipalities: City Reports |
2015 |
1987 - 2014 (note: Additional archival reports available to ifpi members) |
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Indiana Fiscal Policy Institute
601 South Meridian Street Indianapolis, IN 46225 |