Update: This story now contains the correct dollar amount of the state subsidy for Amtrak, which was incorrectly reported in a previous story.

Indiana's troubled child welfare agency would get a big financial boost and K-12 education funding would stay steady despite a tight state-spending outlook, according to a two-year budget that Gov. Eric Holcomb proposed Thursday.

The budget is a 2.5 percent spending increase in 2020, to nearly $16.8 billion, and a 2 percent increase in 2021, to $17.1 billion. Holcomb proposes to keep more than $1.8 billion in reserves, about 11 percent of the budget.

There are cuts, including a subsidy for Amtrak's Hoosier State Train between Chicago and Indianapolis, which would end the route.

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In general, though, agencies will have the same amount of money or more to spend as in the last budget.

Lawmakers will make changes as they debate the budget until a final version is passed in late April.

Here are 6 takeaways:

Department of Child Services to get $286M boost

Holcomb is asking lawmakers to fully fund DCS's request for an additional $286 million, bringing the agency's budget in line with actual spending.

The state has been working to reform the chronically overworked and overbudget agency. Indiana has more youths in its child welfare system than do any surrounding states in theirs, according to a report released in June, and some caseworkers have caseloads that exceed standards.

The report recommends improving staff training, decentralizing decisions, giving staff members more time to both respond to and assess cases, reducing the supervisor-to-caseworker ratio, finding alternatives to DCS for opioid addiction treatment and creating a strategy to retain staff.

Schools spending keeps up

Holcomb is proposing a 2 percent increase each year in the state’s $7 billion K-12 education budget, which makes up a little more than half of state spending. When the initial budget talks centered on DCS increases, there was fear in education circles that schools would get flatlined. But the clouds have parted thanks to a math error (see below), and there is enough money in the budget to give schools a modest bump.

The increase — $143 million in 2020 and another $146 million in 2021 — would keep education spending about on track with inflation, meaning schools won’t necessarily feel a big boost but shouldn’t feel a pinch either. This could also translate to a cost-of-living raise for teachers, depending on the pace of change in other expenses for schools.

More money for teachers, kind of…

Speaking of teacher pay, there’s been a lot of talk about making a significant investment in teacher salaries to lift the state’s average pay above or near that of surrounding states. Holcomb’s budget proposal doesn’t do that.

What does it do? Repurpose an unpopular grant with the hopes that some of that money will get to teachers’ wallets. Technically, the money from the Teacher Appreciation Grant was already going to teachers, but Holcomb is suggesting another use for it.

His budget takes the $30 million dedicated to that program annually and directs $10 million of it toward increasing the tax credit teachers can claim for buying school supplies. The remaining $20 million will go into the basic education budget, and the governor is hoping schools will pass it on to teachers. If it were spread evenly among the state’s teachers it would work out to somewhere around $300 per year.

Amtrak funding cut

The budget cuts a $3 million annual subsidy for the Hoosier State Train.

If the budget cut is approved, state money for the train would run out June 30. Officials from the Indiana Department of Transportation say they would work with Amtrak to schedule an ending date for the service.

Micah Vincent, director of the state Office of Management and Budget, said ridership is not high enough and is not growing quickly enough to justify the subsidy.

The future of the train has been unclear for years due to its many challenges, including slow speeds and infrequency. In 2017, Amtrak took over operation of the train from Iowa Pacific Holdings, which wanted a larger subsidy.

The train is funded by mostly by INDOT, with another $500,000 or so from Lafayette, West Lafayette, Tippecanoe County, Crawfordsville and Rensselaer.

The service could be saved if lawmakers have the will to do it.

House and Senate Republican leaders said they planned to talk over whether to continue funding the train as the session progresses.

More dollars for worker training

The rest of Holcomb’s so-called Next Level agenda, announced in December, will also be funded by his budget proposal. Little of that requires new money, though.

Most changes called for in the agenda are shifts in how existing budgets are spent — either within or between departments. With his focus on workforce issues, most changes are happening within the Department of Workforce Development, with dollars being redirected to grow grants for several of the governor’s worker training initiatives, fund new computer science teacher training and career counseling and more.

Over the next two years, the Workforce Development budget is expected to grow by $6 million or $7 million.

How bad budget math became good news

The governor had more new revenue to spend than previously thought.

Money looked tight after the state revenue forecast was released in December at a meeting of the State Budget Committee. Maybe too tight to fund healthy increases for the DCS and education.

After the December meeting, lawmakers and state officials used the forecast to project the state would have $442.8 million in new revenue to spend in 2020 and $386 million in 2021 — less than what was needed to fully fund DCS, education and other priorities.

To get to that new revenue figure, though, officials incorrectly used an outdated estimate for 2019 state revenue and didn't take into account unappropriated Medicaid money the same year — giving the state an additional $178 million in new revenue per year to use in the next budget.

Odds and ends: New fish hatchery, swine barn, veteran tax credit

The budget includes cash for several miscellaneous initiatives throughout the state:

$6 million to design and build a new swine barn at the State Fairgrounds

$16.7 million to update and build new fish hatcheries for the Department of Natural Resources.

$150 million to repair various state-owned facilities.

$12 million for a third Indiana State Police crime lab.

$10 million to upgrade voting systems throughout the state.

$1.5 million per year for grants to allow small-business owners to purchase research expertise from Indiana's higher education institutions.

$3.3 million per year for an Obstetric Navigator Program to address infant mortality.

$1.1 million per year for youth-based risk behavior studies in Indiana schools.

Exempt military retirement and pension income from state taxes, phased in over four years.

IndyStar reporter Kellie Hwang and the Lafayette Journal & Courier contributed to this story.

Call IndyStar reporter Chris Sikich at 317-444-6036. Follow him on Twitter: @ChrisSikich and at facebook.com/chris.sikich.

Call IndyStar education reporter Arika Herron at 317-444-6077. Follow her on Twitter: @ArikaHerron.