One month ago, I reported that Indiana ended the 2004 fiscal year with a “Surplus” of $505.2 million on June 30, 2004. I also pointed out that the “Surplus” was truly a one-night-only event because it was not possible without the delay of payments to schools, colleges, universities and local governments and a $50 million no-interest loan from the Public Deposit Insurance Fund. Taking those factors into account, Indiana government’s “Surplus” on June 30, 2004, was $256.9 million in the red.

Figures are now available for the end of July, just one month into the fiscal year. Following a $505.2 million Surplus on June 30, the total balance in Indiana’s Surplus accounts on July 31, 2004, was a negative $1,024,289,235.18. That’s right, Indiana government’s operating accounts stand more than $1 billion in the hole. And that’s where Indiana government has ended each month since July 2001, with the exceptions of September 2001 and each June 30 thereafter, when through the use of payment delays, transfers, and loans Indiana government has propped up its bottom line for one-night only.

By the way, don’t let anyone who hears these facts tell you it’s just “talking Indiana down.” It is not. The “Surplus” figure is a measure of Indiana government and its operating revenues and expenditures, not Indiana as a whole. It tells you how well those charged with running Indiana government handle your state government’s finances.

Many Hoosier businesses are doing well. Others are not. That’s not what the “Surplus” measures. The “Surplus” measures how well Indiana State government is managing itself. You be the judge.

Sincerely,

Connie Nass
Auditor of State