Indiana Gov. Braun calls for 5% state agency spending cuts
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Indiana Gov. Mike Braun. Photo illustration: Axios Visuals; Photo: Kevin Dietsch/Getty Images
Indiana Gov. Mike Braun wants to shrink state government over the next two years.
Driving the news: Braun's biennial budget proposal, released Thursday, calls for new tax cuts and reductions in state spending while maintaining support for public schools and Medicaid.
- He's asking state agencies to cut spending by 5% over the next two years and has identified $700 million in reductions.
By the numbers: The state is expected to spend about $45 billion over the next two years.
- Braun's budget covers Medicaid expenses, which are expected to grow by roughly $1.7 billion over that time.
- His proposal increases funding for K-12 public schools by 2% each year for an increase of nearly $540 million and spends $360 million to eliminate the waitlist for child care subsidies for low-income families.
- Separately, he's also calling on schools to raise starting teacher pay from $40,000 to $45,000.
A caveat: The budget doesn't include Braun's property tax cut proposal, which is expected to cost schools more than $500 million in the first year and more than $600 million in the second.
- Braun said some districts have mismanaged their spending and those that can't live within their means after property tax cuts are "going to get back down to Mother Earth."
- "I'm a big believer that we gotta get more money into the classroom," he said, "not on the building and the operations, but into instruction and teachers."
Braun wants to make the state's private school voucher program universal, meaning the state would subsidize the cost of private school education for any family regardless of income.
- Access to the program has steadily widened in recent years to include higher-income families and is currently open to all but the wealthiest Hoosiers.
The other side: Democrats praised Braun's proposal to eliminate the waitlist for child care subsidies but asked him to rethink cutting public health spending.
- In the last budget, Republicans added $150 million annually to public health spending in an effort to incentivize county health departments to add services.
- All 92 counties have opted into the funding, but Braun would cut it to $100 million annually.
Braun's budget also makes good on campaign promises for additional tax cuts on retirement income and tipped wages.
- He's proposing several tax holidays (periods when select goods or services are exempted from sales taxes) for back-to-school shopping, youth sports, outdoor recreation and possibly more — something Indiana doesn't currently offer.
What he's saying: "How do you do it? You run the government more efficiently," Braun said.
What's next: Braun's proposal will be the starting point for lawmakers' budget discussions, which will be dominated by Republicans since they have a supermajority in both chambers.
- House Republicans will introduce their spending plan next, followed by Senate Republicans in the second half of the legislative session.
- A final budget deal will be struck in April, after lawmakers receive an updated revenue forecast.