senate hb 1001 ppt 4.4.13 final

Senate Budget Priorities

• Honestly Balanced Budget

• Promote Hoosier Job Growth

• Fund Our Priorities

• Prepare For Indiana’s Future

Minnesota AA+/ Aa1/ AA+

Iowa (AAA/Aaa/AAA)

Illinois A-/ A2/

A

Indiana (AAA/ Aaa/ AAA)

Missouri* AAA/Aaa/AAA

Arkansas AA/Aa1/NR

Louisiana AA/ Aa2/ AA

Alabama AA/ Aa1/ AA+

Georgia AAA/ Aaa/ AAA

South Carolina AA+/Aaa/AAA

North Carolina AAA/Aaa/AAA

Tennessee AA+/Aaa/AAA

Kentucky (AA-/Aa2/A+

Virginia* AAA/Aaa/AAA

Ohio AA+/Aa1/

AA+

Michigan

AA-/Aa2/AA-

New York AA/Aa2/

AA

Vermont AA+/Aaa/AAA

CT AA/Aa3/AA

NJ AA-/Aa3/AA-

Washington AA+/Aa1/AA+

Oregon AA+/Aa1/AA+

Nevada AA/Aa2/AA++

Utah AAA/Aaa/AAA

California A/A1/A-

Idaho (AA+/Aa1/AA)

Montana AA/Aa1/AA+

Wyoming (AAA/NR/NR)

Arizona (AA-/Aa3/NR)

Colorado (AA/Aa1/NR)

New Mexico AA+/Aaa/NR

Texas AA+/Aaa/AAA

Oklahoma AA+/Aa2/AA+

Kansas (AA+/Aa1/AA)

Nebraska (AAA/NR/NR)

South Dakota (AA+/NR/AA)

North Dakota (AA+/Aa1/NR)

Wisconsin AA/Aa2/AA

Maine AA/Aa2

/AA

Pennsylvania

AA/Aa2/AA+

MD * AAA/Aaa/AAA

Florida AAA/Aa1/AAA

RI AA/Aa2/AA

Puerto Rico Baa3/BBB/BBB+

Alaska AAA/Aaa/

AAA

Hawaii AA/Aa2/AA

DE AAA/Aaa/AAA

West Virginia AA/Aa1/AA+

Ratings Source: S&P / Moody’s / Fitch

* Maryland, Virginia, and Missouri on negative watch

Mississippi AA/Aa2/AA

+

DC A+/Aa2/AA-

( ) indicates states with no G.O. debt.

Ratings are hypothetical.

MA AA+/Aa1/AA+

NH AA/Aa1/AA+

U.S. Credit Ratings

As of March 4, 2013

AAA

AA+

AA

AA-

A+ or lower

Appropriation-Backed Debt

Appropriation-Backed Debt

Issuing Entity Debt Outstanding

(As of 12/31/12)

Transportation Finance Authority $1,215,646,298

Public University (Fee-Replaced) $1,192,991,057

State Office Building Commission $489,727,558

Indiana Bond Bank (Moral Obligation) 2 $449,910,000

Recreational Development Commission $27,190,000

Total $3,375,464,913

Appropriation-Backed Debt - Revenue Supported

Issuing Entity Debt Outstanding

(As of 12/31/12)

IFA-Stadium & Convention Center 1 $977,065,000

Indiana State Fair 1 $62,165,000

Total $1,039,230,000

1 Debt Service anticipated to be paid fully by revenue sources but also are backed by appropriations 2 Moral obligation to replenish reserve accounts if used for debt service.

NOTE: Figures do not include transfers from Automatic Taxpayer Refund

Affordable Care Act by the Numbers

Year Number of Hoosiers

on Medicaid

Percentage of

Hoosier

Population

Federal

Cost State

Cost Total

Cost

2012 1 Million 16% $4.3 Billion $2.2 Billion $6.5 Billion

2015 1.2 Million

(no expansion of

eligibility) 19% $6.4 Billion $3.3 Billion $9.7 Billion

? 1.8 Million

(expand eligibility to

138% of poverty) 28% ? ? $13.5 Billion

Note: As a comparison, the cost of the K-12 formula is

approximately $6.5 Billion per year.

Source: Milliman “Affordable Care Act (ACA) – Medicaid Financial Impact Analysis Update” Sept. 2012

Honestly Balanced Budget

• $29.5 Billion Two-Year Budget

• Ongoing Revenues Exceed Ongoing

Expenditures

• Ends Biennium with $2.5 Billion in

Reserves

Includes $400 million for

transportation needs and $600

million for potential health care

needs over the biennium

Promote Hoosier Job Growth

• Cuts individual income tax rate from 3.4% to 3.3%,

effective Jan. 1, 2015 ($150 million per year)

• Eliminates state inheritance tax, retroactively effective

to Jan. 1, 2013 ($150 million per year)

• Cuts financial institutions tax rate from 8.5% to 6.5%,

phased in over four years, starting in 2014 (Contained

in SB 552; $19 million per year)

• Includes funding for vocational education and

workforce development initiatives contained in SB 465

(Indiana Works Councils - $6M over the biennium) and

HB 1002 (Indiana Career Council - $750,000 over the

biennium)

Funding Our Priorities:

K-12 Education

• Increases K-12 funding by $331 million over the

biennium.

2% increase in FY 2014 and 1% increase in

FY 2015

• Provides performance funding opportunity for

every public school.

• $10 million per year for school resource officers

(SB 1)

• Funds Principal Leadership Academy (SB 402)

Funding Our Priorities:

Higher Education

• Increases operating funds by $99 million over the

biennium

Operating dollars include $61 million in

performance funding for institutions (same as

current level).

• Authorizes $383 million in university capital projects

• Financial Aid:

• Increases student aid by $43 million in FY 2014 and

$28 million in FY 2015

• Provides $230 million for 21st Century Scholars over the

biennium

Funding Our Priorities:

Roads & Infrastructure

• Provides additional $112 million to INDOT and $101 million

to local roads to match local commitment

Reallocates 1% of the sales & use tax distribution to the

Motor Vehicle Highway Fund

Phases in a replacement of the Motor Vehicle Highway

Fund appropriation for the State Police and BMV with

state general fund dollars over two years

• Invests $200 million per year for two years into the Major

Moves 2020 Trust Fund for major highway expansion

projects.

Funding Our Priorities:

Roads & Infrastructure

Currently Funded Major

Capital Projects

• Milton-Madison Bridge ($52M)

• US 31 Kokomo ($155M)

• SR 25 Hoosier Heartland ($327M)

• US 31 Plymouth to South Bend

($223M)

• US 31 Hamilton County ($346M)

• I-69 Crane to Bloomington ($400M)

Potential Transportation

Corridor Opportunities

• Widen I-70 from 4 lanes to 6 lanes,

Illinois to Ohio ($1.35B)

• Widen I-65 from 4 lanes to 6 lanes,

Kentucky to I-80/94 ($1.97B)

• Indiana Commerce Connector

($1.52B)

• I-69 Bloomington to Martinsville

($306M)

Funding Our Priorities:

Child Protection

• Increases funding for DCS by $30 million per year

to provide:

• Additional case managers and supervisors

• Improved services for children with severe

mental and behavioral health needs

• Improvements to child abuse hotline

• $10 million per year for school resource officers

(SB 1)

Prepare for Indiana’s Future:

Health Care

• Fully funds the Medicaid forecast

• Creates the HIP Savings Account, consisting of:

• HIP fund balance (more than $200 million)

• Any 2013 Medicaid appropriation reversions

(approx. $234 million)

• HIP annual cigarette tax revenues beginning Jan. 1, 2014

($120 million per year)

• Includes provisions that let the governor negotiate with federal

government to receive block grant for any Medicaid expansion.

(SB 551)

• Requires General Assembly approval to release funding for any

negotiated health care plan.

Prepare for Indiana’s Future:

Paying Taxpayer-Funded Debt

• 100% of excess surplus (approx. $97 million) in

FY 2013 goes to Pension Stabilization Fund

• Repays $50 million Public Deposit Insurance

Fund loan (SB 552)

• Pays back charter school loan ($80 million)

• Provides $200 million cash funding for university

capital projects