CHICAGO — Indiana lawmakers and Gov. Mike Pence will begin negotiations on a final $30 billion, two-year budget this week with the deadline of hammering out a final spending plan by the end of the month.
The spending plans from the House, Senate and Pence all feature tax cuts and new transportation funding, though the size of the proposals vary.
The Senate Appropriations Committee last Thursday approved a new $29.5 billion two-year budget that chops Pence's 10% income-tax down to 3%, or down to $150 million from roughly $800 million. The Senate plan also sets up a new road fund with general fund dollars and increases K-12 funding by 3%, or $300 million, over the next two years. That's nearly double the amount that Pence wants to increase the K-12 budget.
The full Senate will vote on the budget this week.
The House passed a budget three weeks ago that dropped Pence's proposed 10% income tax cut entirely.
The General Assembly and Pence will now begin to negotiate a final budget by the April 29 end of the session.
All three versions increase infrastructure spending, a move seen necessary now that all proceeds from the lease of the Indiana Toll Road have run out.
The House budget raises infrastructure spending by $500 million while Pence's plan would dip into surplus funds for a $340 million, one-time deposit into a newly created infrastructure fund.
The Senate's spending plan sets aside $400 million of general fund money to go into a new Major Moves 2020 fund for transportation projects. It also increases road funding by $200 million through 2015, giving state and local governments roughly $100 million each.
The Senate budget would leave reserves of $1.5 billion by the end of 2015. It also sets up a health care account in case Indiana expands Medicare as part of the new federal health care laws.
"I believe that we are getting on the same page, but let me be clear," Pence said in a statement. "There are still details and differences about levels of spending and priorities. This latest version of the budget does signal that there is a pathway to creating a successful budget that will meet our administration's objectives."
The triple-A rated state currently has a $2 billion reserve.