In Indiana, stimulus grows rainy day fund

By The Sunlight Foundation Reporting Group

The North West Indiana County Times recently pointed out something fascinating about how Indiana was using funds granted to it under the American Recovery and Reinvestment Act:

Indiana State Budget Director Christopher Ruhl confirmed the federal stimulus money was used to provide basic tuition support dollars for school districts, allowing the state to squirrel away funds that normally would have been used for that purpose.

“The state dollars saved were placed in our education rainy day fund,” he said. “The special session budget required those funds be transferred from the education rainy day fund to the state general fund in 2010 to support school funding. We made that transfer in December.”

All the state’s reserves and rainy day funds are expected to be used over the life of the two-year budget, including 100 percent of the education rainy day fund, Ruhl said. The budget, which runs through June 2011, was built on revenue projections that haven’t panned out, setting up the need to drain the $1 billion in state reserves.

This raises a couple of questions:

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The Sunlight Foundation Reporting Group is part of the Sunlight Foundation, a nonprofit, nonpartisan Washington, D.C.-based organization that uses cutting-edge technology and ideas to make government transparent and accountable.