DALLAS – Indiana closed out fiscal 2016 with a slight surplus despite the drain of low gas prices on revenue growth.
The State Budget Agency Office reported a structural surplus of $50.6 million and $545 million in its rainy day fund for a total of $2.24 billion in various state reserve accounts.
Revenue in the fiscal year that ended June 30 finished $111.3 million below a revised forecast and $78.5 million below revenue collected in fiscal 2015.
"By operating with a balanced budget and living within our means, Indiana has maintained strong reserves as well as our AAA credit rating," state Auditor Suzanne Crouch said in a statement announcing the results.
Indiana collected $15.04 billion in taxes and other revenue during the 2016 budget year, after $15.3 billion was appropriated by the Republican-controlled General Assembly, according to the report. The state made up for the difference with agencies holding down planned spending by $250.8 million. State spending then totaled $14.99 billion.
Lieutenant Gov. Eric Holcomb told Indiana Public Media that the record reserve levels mean the state can now invest $428 million into road funding.
During the 2017 budget year, the state is poised to spend $427.9 million from its reserve fund on state and local road and bridge preservation projects. About 55% of the road funding money will go into the state highway fund; the rest will be used to cover a new matching grant fund for local road and bridge construction.
Indiana spends about $570 million per year on state roads, but a 2015 transportation funding study said the state needs to spend $1.5 billion per year over the next 20 years to keep its existing transportation infrastructure in good condition.
The transportation study said the $450 million per year that Indiana's fuel taxes now generate will dwindle to $300 million due to inflation over the next 10 years.
In March, Indiana lawmakers agreed on a compromise road funding plan to provide more than $1 billion for transportation projects over the next two years while postponing a solution to the state's infrastructure funding gap until next year's legislative session.
The plan forgoes increases in the state's gasoline and diesel taxes. It provides $328 million for state highway projects and $254 million for local roads over the next two fiscal years from Indiana's budget surplus. Another $430 million of excess local option income taxes that the state has been withholding would be released to local governments.
Indiana Gov. Mike Pence signed into law the biennial budget for fiscal years 2016-2017 on May 7, 2015. In February, Pence proposed a $1 billion road funding program and bridge repair program that relies on state reserves and borrowing.
Holcomb has served as lieutenant governor for five months since Pence appointed him after Sue Ellspermann resigned from the position. On Tuesday, the Indiana Republican State Committee voted to approve him as the GOP candidate for governor, replacing Pence, who is running for vice president on Donald Trump's GOP ticket.
Indiana holds triple-A ratings from the three largest rating agencies. S&P Global Credit Ratings reaffirmed Indiana's AAA credit rating in April and Fitch Ratings reaffirmed the state's AAA credit rating in June.