Proposed Budget - Fiscal Years 2024-2025
On January 5, Indiana Governor Eric Holcomb proposed a two-year budget for fiscal 2024 and fiscal 2025. The budget calls for $48.8 billion in total spending in fiscal 2024 (a 2.3 percent increase compared to the recommended current estimate for fiscal 2023), and $47.4 billion in fiscal 2025 (a 2.8 percent decline from recommended fiscal 2024). General fund spending is recommended at $20.8 billion in fiscal 2024 (a 12.1 percent increase compared to fiscal 2023) and $20.1 billion in fiscal 2025 (a 3.1 percent decline from fiscal 2024). General fund revenues are estimated to increase 3.2 percent in fiscal 2024 and 2.9 percent in fiscal 2025. The budget assumes an annual operating surplus of $564.1 million in fiscal 2024 and $545.1 million in fiscal 2025. Additionally, the budget projects an annual reserve balance of $3.0 billion in fiscal 2024 (14.2 percent of expenditures), and $3.2 billion in fiscal 2025 (14.5 percent of expenditures).
Proposed Budget Highlights
The governor noted his Next Level Agenda includes historic increases for K-12, higher education, and Medicaid while completely funding the Governor’s Public Health Commission’s recommendations. In addition, his recommended budget is balanced, funds critical services, maintains prudent levels of reserves, and maintains the state’s AAA credit rating. Highlights of the budget proposal include:
Health and Wellbeing
- $120 million in fiscal 2024 and $227 million in fiscal 2025 to implement the Governor’s Public Health Commission recommendations, with most of the dollars allocated at the county level.
- Better access to mental health services including a three-pillar crisis prevention and response system.
- Begins to invest national opioid settlement funds to create more community substance use programs.
Education and Workforce
- Increases support by 6 percent in fiscal 2024 and 2 percent in fiscal 2025, equaling $1.2 billion.
- Establishes a $20 million incentive program to improve reading scores.
- Prohibits textbook and curricular material fees.
- Higher Education
- Increase support by 6 percent in fiscal 2024 and 2 percent in fiscal 2025, totaling $184 million, with a portion based on performance goals of retaining graduating students in Indiana.
- One-time $10 million commitment to Martin University to boost graduation at the state’s only predominantly Black institution.
- Early Learning
- Expands eligibility for Child Care and Development Fund vouchers and will work with legislators to expand On My Way Pre-K eligibility by raising income limits.
- Proposes more investments in adult education to reduce the number of working age adults without a high school diploma or workforce training.
- Focuses on diversifying the Indiana Economic Development Corporation (IEDC) toolkit to remain competitive for future growth.
- Formalizes a $300 million per year deal closing fund and an additional $300 million per year tax credit gap to give the state flexibility to attract new businesses and jobs.
- $500 million to fund another round of the Regional Economic Acceleration & Development Initiative.
- $50 million for trails improvements and $25 million for additional land conservation efforts.
- $70 million in state and federal funds to address broadband service gaps.
- Public Safety
- Increases the Secured School Safety Grant Fund to $25 million.
- Raises the starting salary of state police troopers to $70,000.
- $24.2 million investment in a regional firefighter training infrastructure.
- $160 million budget request to fund the state employee compensation pay study to attract and retain state employees.
- Requests funding in the current fiscal year to complete four capital projects.