Porter statement on Indiana budget issues resulting from COVID-19 pandemic
INDIANAPOLIS – State Rep. Gregory W. Porter (D-Indianapolis) today issued the following statement on the upcoming 2021 budget session as Indiana continues to face the adverse economic and health impacts of the COVID-19 pandemic:
“The Hoosier State is not unlike the rest of the country reeling from revenue loss as a result of a global pandemic,” Porter said. “However, our hands are not tied as we approach this upcoming budget year. If state leadership were to act quickly, the following action at minimum could create a cushion for the severe economic situation facing Indiana.
“First, as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act the Federal Reserve has established a program known as the Municipal Liquidity Facility (MLF) program. MLF would allow Indiana to borrow up to 20 percent of its 2017 General Fund budget amount for up to three years, which would be approximately $3 billion. Due to Indiana's second to none bond rating, the cost of the borrowing for up to three years would be minimal.
“Second, the state is currently receiving additional Medicaid dollars due to the COVID-19 national emergency. Previously, Indiana has elected to use about half of the first distribution of money to balance the SFY 2020 budget. Another $359 million is anticipated to be received by the end of December. The Holcomb Administration should pledge now to use that money solely for Medicaid since so many more Hoosiers are using it due to the loss of employer health insurance coverage. Any money not used in the next three months should be placed back in the Medicaid reserve for use in 2021. Remember Indiana completely emptied the $577 million Medicaid reserve in July of this year to help balance the SFY 2020 balance.
“Third, a few years ago Governor Holcomb increased the tolls on trucks by over 30 percent. In return, the party leasing the toll road paid Indiana $1 billion over a three year period. Just last week, Indiana received the final $300 million payment from that toll increase on Oct. 1. I am recommending that since there is no immediate need for this money to be spent that it be placed in a reserve account to be utilized to mitigate any reductions in state revenue due to the COVID-19 crisis.
“State leadership need to do everything within its power to ensure a sound budget without mindless cuts. These are just a few solutions, and I would welcome the opportunity to discuss these further.”