Governor says state found extra $300 million - 13 WTHR Indianapolis

Governor Mitch Daniels says the state found an extra $300 million and it's an early Christmas present for Hoosiers.

It's always a good thing when you find some spare change in the break room, five dollars in your pants pocket or 20 bucks you just forgot about in your desk.

So what is it like when you find $300 million?

"The state always had the money. The state always earned interest on the money. It was just sitting in this account and not allocated into the general fund," Daniels said Tuesday.

An internal audit turned up the stash of corporate income tax money.

"There are several ways a corporation can pay digitally, electronically now, and one of them is E-check. I think it's the most heavily used option and the software programmer who modernized the rest of the system did not write the necessary code to routinely sweep the money from one account to the general fund," Daniels said.

The money began accumulating in 2007, but it wasn't noticed until earlier this year when the corporate income taxes collected began to increase and the total began to skyrocket. That, coupled with the fact that Indiana's tax revenue collections are currently running $117 million above projections and we are starting to hear some serious discussion about a tax refund but it won't be in time for the holidays.

The legislature just enacted the automatic tax refund last session. Before the refund can actually take place, the state needs to demonstrate a balanced budget and have 10 percent of next year's budget in savings. If the rebate trigger is activated, half of the stash would go to the Teacher Pension Fund. The other half would be rebated to taxpayers through their income tax.

"There is a very good possibility, with everything we know, we would be in the zone, triggering an automatic refund to taxpayers next year," Daniels said.

The governor compared it to playing Monopoly and drawing the "bank error in your favor" card, which he just so happened to have on hand.

If you are wondering how much that rebate could be, if the surplus were $1.7 billion, for example, the average refund would be roughly $50. We will not know whether taxpayers will be able for any refund until next July.