INDIANAPOLIS (Inside INdiana Business): The state of Indiana has until the end of the year to spend about $650 million dollars in federal coronavirus relief funds. Governor Eric Holcomb says the state had hoped to get an extension on the deadline to use the money, but that has not happened.
“But we do have a plan that those funds will be obligated and allocated and used here in the state of Indiana. We’re not going to be sending money back or leaving money on the table or wasting any dollars,” said Holcomb.
The Indiana Office of Management and Budget says it is planning to use approximately $400 million dollars to help replenish the state’s unemployment insurance trust fund.
OMB Director Cris Johnston says the state has drawn down more than $1.4 million from the fund as unemployment claims spiked during the pandemic.
Johnston says the state tries to keep the fund around $1 billion. He says the state has had to borrow money from the federal government to cover a shortfall in the fund.
“We believe it is prudent to make a deposit to avoid that borrowing,” said Johnston.
The Indiana Chamber of Commerce says putting the federal CARES Act money into the unemployment insurance trust fund makes sense for the state.
The fund is financed in part by taxes employers pay on employee wages.
“The business community could not be expected to solely replenish the fund. The pandemic was unforeseen and far too many companies are barely hanging on as it is in this uncertain climate,” said Kevin Brinegar, Indiana Chamber president and chief executive officer. “This is one less thing for businesses and workers to worry about.”
Brinegar says replenishing the trust fund provides greater certainty for both those who receive unemployment and Hoosier employers who pay into the pool.
But with the uncertainty of the pandemic and the economy, Johnston says the state must be prepared to borrow additional funds through spring.
Johnston says the remainder of the money, approximately $250 million, could be used on a variety of programs, including repaying schools for out-of-pocket pandemic-related expenses.