Education, health care highlight budget pitches for lawmakers

In the latest round of budget pitches, state agency heads detailed their funding requests before members of the General Assembly Monday, claiming victories and minimizing missteps over the last two-year budget cycle.

Indiana’s lawmakers will convene in January to kickstart the 2025 legislative session, which will focus on crafting the next biennial budget. Nine additional departments presented before the State Budget Committee in Indianapolis, building upon the work of other agencies and higher education institutions from November.

Monday’s meeting included baseline budgets, or budget data from the last few years. Budget pitches begin in earnest next month after analysts have time to absorb revenue forecast data, which is scheduled to be presented this week.

Education concerns

The Department of Education traditionally accounts for roughly half of the state’s $44 billion budget — though legislators previously cautioned that projected health care growth threatens that line item.

For the 2024 fiscal year, the agency received more than $9.4 billion from general funds, and estimated a base budget of $9.6 billion moving forward. Nearly all of that funding is funneled to schools in the form of tuition support, a calculation that includes the number of students in a given district with specialized needs, including students with disabilities, poverty status and English learners.

Katie Jenner, the secretary of education, will hold her position in the next administration and pointed to areas of progress— including small literacy gains and an increase in the average teacher salary — but said more work was needed.

“(Since) the last time I was here, we went up about 20,000 English learner students in Indiana. This is probably the most significant growth we’ve seen in any of our student population points,” Jenner said.

The biggest teacher needs in the state were special education teachers, another growing population, followed by English learner educators, she added.

The highest English learner growth was concentrated in the cities of Indianapolis, Fort Wayne, Elkhart, Goshen, Seymour, Columbus and Logansport, Jenner said. The state doesn’t track student immigration status and has a duty to educate every student, regardless of their citizenship.

But literacy progress among this population and Hispanic students has “plateaued,” Jenner said, and is “one area that I’m very concerned about.”

“Indiana’s literacy rates have been in decline for more than a decade, with the exception of one year. The pandemic, no doubt, exacerbated the literacy crisis,” Jenner said, before pointing to legislation appropriating new funds and dictating new methods of teaching.

Rates have improved slightly in recent years and lawmakers spent much of the last session struggling with how to provide additional supports for students and teachers at minimal cost.

One potential remedy has been increasing funds for summer schools, as documented in budget pitches. Though most students attend the vacation education programming for physical education or health classes, third- and second-grade reading make up the second- and fourth-largest populations, respectively.

In 2024, the state spent $26.7 million on summer school, with 15.7% of those costs going toward the two reading courses.

Jenner acknowledged the tight budget session coming up and said she would be asking for a budget increase but that the agency also needed to be held accountable.

“Let’s fund what’s working and let’s reallocate where it’s not and put that funding back into what is working,” Jenner told lawmakers.

Rep. Ed DeLaney, D-Indianapolis, sought to get a promise from Jenner that she would press the body for an increase in funding if she needed one, even if such a request went against the wishes of Gov.-elect Mike Braun.

“… tell us that your budget is a trim back and it’s not what you want. Tell us what area you want more money for … the betterment of our children. Are you willing to do that?” DeLaney said. “Or will we see what I’ve seen in the past, where every governor-elect’s budget is the ask?”

Jenner said she would work with Braun but said she would tell the General Assembly “exactly what that (budget) number is.”

In particular, DeLaney pushed Jenner to detail potential costs associated with adopting a new diploma — and whether there would be any savings realized down the road.

“We had to think about how to make the four years of high school as valuable as possible for Indiana students,” Jenner responded.

Shortening the waitlists

The biggest questions surrounding the Family and Social Services Administration budget pitches for various divisions — including Medicaid, which reported a nearly $1 billion shortfall last year — will be answered later this week during a forecast presentation, noted Dan Rusyniak, who leads the agency.

More recently, the agency made news when it implemented another waitlist for child care vouchers after reporting a 40% in demand.  With federal dollars from the COVID-19 era stimulus packages soon expiring, Rusyniak said the agency would need more funds to support the 75,000 families currently receiving services.

“We estimate we can support around 50,000 of those children in the next federal fiscal year,” Rusyniak told lawmakers.

In the 2024 fiscal year, FSSA received $5.1 billion from the General Assembly and $2.3 billion in dedicated funds, compared to $16.8 billion from the federal government. Medicaid makes up the largest portion of that budget, or $20 billion.

Payments for parents getting child care subsidies average $7,000, Rusyniak said. Eliminating the waitlist would take another $140 million investment from the state, he estimated. Doing that for the waitlist of long-term services for the elderly and disabled would require not only additional funding but some new approvals from the federal government.

Attorney General’s Office

The last agency to present its budget pitches for departments promoted itself as asking for no increase “whatsoever,” regardless of additional burdens imposed by the General Assembly.

Attorney General Todd Rokita boasted about his decision to pursue litigation, some of it potentially expensive, including actions against Tik Tok and “federal government overreach.”

Additionally, the office frequently joins sign-on letters and amicus briefs, for a total of 280 in 2024.

“Defense of your legislation takes a tremendous amount of our time and we’re proud to defend the laws that you pass,” Rokita said, highlighting abortion restrictions, pornography age verification and the opposition to gender-affirming care, in particular.

Other subdivisions within the office include the Medicaid fraud unit and its pursuit of negligent landlords.

But DeLaney questioned Rokita about his politicization of the office and his decision to join certain suits, such as whether Pres.-elect Donald Trump should appear on the ballot in Colorado or suing the Biden Administration over border control.

“You talk about how you support Indiana’s values and you’ve sued the federal government over the border, about elections, about the environment, about coal,” DeLaney said. “Who gives you direction? Who calls you up and says, ‘I need this lawsuit brought?’”

Rokita responded by saying, “I think, ultimately, as an elected Attorney General, I’m elected by the people of the state and with that I’m given discretion and authority through that electoral process.

“… the way I look at my client-attorney relationship is, I am the legal voice for the state of Indiana.”

The costs of some filings are underwritten by contingency fee arrangements, including the case against Tik Tok and another against Google and Pharmacy Benefit Managers. That means outside groups take on the work and won’t receive payment unless they’re successful in court.

DeLaney openly wondered how much the state would save with the incoming Trump administration, which Rokita — an avid fan of the politician — would likely sue less.

The State Budget Committee will meet again this week to hear the revenue and Medicaid forecast, which will signal how much funding agencies can expect in the upcoming biennium.

The Indiana Capital Chronicle is an independent, not-for-profit news organization that covers state government, policy and elections.