Gov. Mitch Daniels said today that a preliminary look at fiscal data shows Indiana will close the 2012 Fiscal Year with reserves of more than $2 billion and a structural surplus, meaning annual revenue in excess of annual expenses, of more than $500 million.
With reserves totaling at least 14 percent of the state’s budget, most Hoosier taxpayers will receive their first automatic taxpayer refund when they file their state taxes in 2013. The Indiana General Assembly approved the governor’s plan for an automatic taxpayer refund in 2011.
The refund will clearly be in excess of $100 for a single filer or $200 for a joint return. The exact amount will not be ascertained until the fall when the estimate will be made of how many tax returns will qualify. The median income tax payment was a little over $800 last year, so the refund will amount to more than 10 percent for the typical Hoosier.
Because the state’s reserves exceed 10 percent of the upcoming year’s budget, half of the excess will be returned to taxpayers and the other half will go to further strengthen several of the state’s pension funds. That means the pension funds, already rated among the nation’s most secure, will receive at least $300 million.
For Fiscal Year 2013, the state is projecting a structural surplus of more than $400 million, resulting in the state’s reserves again exceeding $2 billion.
Indiana fiscal facts during the Daniels administration: Indiana has its first Triple-A credit rating Indiana’s expenditures have grown at less than one-quarter of the rate of the previous decade Indiana has the fewest state employees per capita in the country Indiana has paid down previous debt 43 percent Indiana repaid more than $750 million of debt previously owed to schools, universities and local governments.
- Indiana repaid a $63 million loan to the Motor Vehicle Highway Fund that originated in the 1990s
- Indiana paid off the 50 year old bonds on the Indiana Toll Road, almost $200 million worth. Indiana has the lowest burden per household to fully fund public pensions in the country
- Indiana has the smallest unfunded liability per capita for retiree health care of any state
- At 6.75 percent, Indiana’s pensions have the most conservative investment return assumptions of any state and is the only state below 7 percent Indiana’s combined pension and long-term debt liability as a percentage of GDP is the 2nd lowest in the country
The Office of Management and Budget and the Auditor of State’s office will complete the closing process and provide the official report in mid-July.