The Jindal administration has repaid a $70 million state treasury loan that was needed to keep public colleges and universities operating.
The repayment resolves one outstanding issue in the 2013-14 state fiscal year that ended this week. However, other issues exist for state government.
Some needed dollars aren’t yet in the bank — state Treasurer John Kennedy says it’s as much as $63 million — from the patchwork approach Gov. Bobby Jindal and legislators took to pay for colleges, hospitals and other public expenses.
The outstanding revenue includes a $2.4 million debt payment by the Orleans Levee District, prompting the Jindal administration to consider Tuesday stepping up its collection efforts. The state loaned more than $5 million to the district after 2005’s Hurricane Katrina and asked for repayment in installments. The district hasn’t made a single installment payment.
“We’re looking at legal remedies against the levee district. They’ve just not responded to our request to pay,” said Commissioner of Administration Kristy Nichols, who is the governor’s chief budget adviser.
No one answered the phone at the levee district’s office Tuesday evening.
Kennedy said the state appears to be short nearly $63 million in reconciling the accounting books for the recently ended state fiscal year.
The fiscal year ended Monday, but the books don’t close until Aug. 14.
Kennedy said the Jindal administration repaid the higher education loan by grabbing dollars that originally were intended for use in the 2014-2015 state budget year. Kennedy said that troubles him.
“They’re using 2015 money to pay expenses for 2014. That leaves a hole in 2015, which causes me to have to loan them more money to fill the hole. If a consumer did it this way, it would be called check kiting,” he said.
Nichols disputed Kennedy’s shortfall figure. She said the treasurer isn’t privy to all of state government’s financial books.
“The treasurer is looking at this from an accounting standpoint based on what’s been deposited at a certain point in time. We’re looking at this on a daily basis,” Nichols said.
Just how much the shortfall is remains unclear. Nichols said she didn’t have an exact figure, noting that six weeks are left before the books close.
With state revenue failing to meet economists’ expectations, the governor and legislators relied on untraditional revenue sources to pay the bills. They sold property, banked on legal settlements and leaned on municipalities to repay their Hurricane Katrina loans.
Most of the untraditional revenue was budgeted for higher education. When the dollars didn’t come in fast enough, public colleges and universities took out loans from the state treasury. Other money hasn’t arrived or came in less than expected. Other revenue sources produced more dollars than expected.
“When you have these kinds of cash flow problems, it’s clear that we’re spending more than we take in, and we have for some time,” Kennedy said.
Nichols acknowledges the cash flow issues. But she said that’s the nature of state government: Sometimes more money is collected in one area and less money is collected in another area. The larger goal, she said, is to collect the total dollars needed.
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