To the Editor:

The State Budget Agency reported that Indiana’s September tax revenues came in about $12.6 million above forecast, putting their calculation of state government revenues for the first quarter of this fiscal year $44.5 million above projections. But whether the monthly portion of tax revenue forecasts are met or exceeded – certainly the preferred results – you have to look at Indiana government’s bottom line to truly gauge whether its fiscal outlook is getting better. The end of September figures are good news, but they pale in comparison to two unassailable facts.

First, state government’s General Fund Surplus statement remains in the red, ending September at a negative $640.4 million. Indiana government ended the first quarter of its fiscal year in worse fiscal shape than it found itself in at the same point in prior years. In fact, this year’s figure for the end of the first quarter is $224 million less than the figure for the same period in 2003. That’s right, just one short year ago Indiana government was $224 million dollars better off at the end of September.

Second, Indiana government continues to run an enormous deficit budget. Even if all the projected revenues for this fiscal year come in at hoped for levels, the General Fund operating budget for Indiana State government would still be more than $800 million in the red. At the end of this fiscal year next June 30, State government will again need to resort to payment delays, loans, and other accounting gimmicks to show a “Surplus.”

That’s the way it was on June 30, 2004, when Indiana government reported a so-called “Surplus” of over $500 million. Taking all of the accounting gimmicks into account, the state’s bottom line at the end of last June was actually over a quarter billion dollars in the hole – and for the first time in memory payment delays were necessary to end the fiscal year in the black.

No one can reasonably expect Indiana government’s fiscal mess to be cleaned up in one month, one quarter, or even one year. It is going to take time. But when confronted with a bottom line that is progressively worse year after year, quarter after quarter, and month after month, Hoosiers realize that their government is still headed in the wrong direction.

Sincerely,

Connie Nass