With the holiday over, state officials begin Tuesday to earnestly apply their portion of $326.5 million in cuts to their agency’s budgets.
The leaders of state offices and departments already had been juggling figures, but they didn’t know the exact numbers until Friday, when Gov. John Bel Edwards signed the legislation that gives legal authority for government to spend public money for the next 12 months.
The historic 19 weeks of deliberations over three separate legislative sessions were rife with gloomy predictions — from shuttered safety-net hospitals to closed college campuses — unless taxes were increased.
Less than a week after Louisiana lawmakers came together to pass a painful budget that fails…
In the end, legislators raised about $1.6 billion in taxes, leaving state government agencies to absorb the rest of the nearly $2 billion shortfall.
The state’s operating budget for the fiscal year that begins Friday is balanced for the time being.
Now that the $26 billion state budget is law, reduced spending means that state services won’t be delivered as quickly, vacancies will not be filled and state workers will not see pay raises.
The popular college-tuition-paying TOPS program wasn’t fully funded for the first time. A juvenile facility in Bunkie will not open in September as planned.
Gov. John Bel Edwards said Friday he would not veto a recent measure to “front load” the TOP…
Much of the impact is still up in the air. How many families receiving vouchers to pay tuition in private schools will be affected?
But the early indications are that all the dire warnings of the past three months won’t come to pass. No parks will close. No inmates will be released. No employees will lose their jobs, at least not immediately.
“What people don’t understand is that they think all we did was raise revenue,” said Sen. Eric LaFleur, the Ville Platte Democrat who as Senate Finance Committee chairman is the upper chamber’s key budget guy. “We also cut spending. We tried to make the cuts as strategic as possible. We tried to make them so that vital services were not reduced.”
Appropriations Committee Chairman Cameron Henry, the Metairie Republican who is LaFleur’s counterpart in the House, said the reduced spending shouldn’t be called cuts. “Every agency put their request in; not every agency is getting what they requested,” he said.
“Everybody is fine, relatively speaking,” Commissioner of Administration Jay Dardenne said.
This year’s budget has no new programs. It provides for most of the same services as last year but has no extra money to cover inflation or merit pay raises for employees.
It’s the largest budget since the ones bloated with recovery dollars after the 2005 hurricanes. Dardenne said that’s partly because of Medicaid expansion money from the federal government and partly because the plan no longer includes “one-time money,” whose source doesn’t recur year after year.
After a long rocky road of politics, Louisiana today joins the 30 other states expanding hea…
But the spending plan for fiscal year 2017 is precariously balanced. State agencies were ordered Friday to set aside a portion of their appropriations just in case tax collections don’t come in as hoped.
Just how deep the cuts would be remained moving targets throughout the 19 weeks legislators were in session, said Robert Barham, who heads the Office of State Parks.
The first write-through proposed cutting the parks’ budget by 60 percent, he said. The cut dropped to 30 percent during the first special session and down to 15 percent during the regular session that ended June 6. By the end of the second special session, the parks’ appropriation was reduced by about 7.5 percent, Barham said.
Initial plans to shut down most parks morphed into preparations to close five parks and six historic sites. “Now, I’m going to try to keep everything open,” Barham said.
“But I’m razor-thin,” he added, explaining that a major breakdown of, say, a sewer system would cause a park to close.
Dardenne said the administration tried to avoid micromanaging individual state offices, asking the individual department heads to list priorities and suggest cuts. Politics also was added to the calculus, LaFleur said.
“You have to mix good public policy with the ability to get the votes. Sometimes we fund things that might not be in the best interest of the whole state but sometimes for a person, or a region, to get that job done,” he said.
For instance, LaFleur said, $250,000 was added for the ARC Caddo-Bossier for the Goldman School in order to get the votes necessary to pass House Bill 69, which gave legal authority to spend the taxes raised during the second special session. After days of negotiations behind closed doors, the measure was narrowly approved with about 40 minutes to go before the midnight adjournment on June 23.
“Generally speaking, the Senate did not want to fund (the school), but it was one of those things that get plugged into the compromise,” LaFleur said, to placate Rep. Jim Morris, an influential Republican from Oil City.
Morris did not respond to three phone messages Friday.
Edwards line-item vetoed that expenditure on Friday and returned the money to the state Office for Citizens with Developmental Disabilities.
Judges and courts took a 5.2 percent reduction of about $8.3 million in their state general fund appropriation.
“It’s not what I wanted,” LaFleur said. “But in order to make the thing fly, we ended up having to cut them more than we originally had discussed.”
What it means is that the justices are going to have to postpone replacing a leaky roof at the Supreme Court building in New Orleans, he said.
The appropriation for the Louisiana Department of Health is about $102 million short of its roughly $11.7 billion budget, most of which will come from the so-called private partners who were contracted to run most of the state’s charity hospitals.
“We believe it is an appropriate level, but obviously they (the private partners) were clamoring for more. We would have been in a position to give them more if we had gotten more revenue,” Dardenne said.
State aid for about 720,000 public school students in Louisiana is about to take its first n…
Similarly, the private operators of state prisons in Allen and Winn parishes are going to have to renegotiate their contracts.
According to Department of Public Safety and Corrections Secretary James M. LeBlanc, who was still putting pencil to paper Friday, the private contractors are paid a daily rate for prisoners. Because of a $29.3 million reduction in state general funds for the corrections department’s $513.6 million budget, that daily rate will need to go down about $6.62, to about $25.29 per prisoner per day. About 900 offenders whose medical and discipline needs can no longer be handled at the private prisons will transfer to state-run facilities, and about 80 staffers will need to be laid off in Allen Parish.
Some departments’ seemingly massive dollar amounts in Louisiana’s ponderously complex $26 billion operating budget are somewhat misleading.
Many state dollars amount to Louisiana’s contribution to a program that is primarily paid by the federal government. About $12 billion in federal money flows through the state’s budget. (Another $4 billion, generally, comes from miscellaneous sources, such as transfers and self-generated dollars, that also must be accounted for in the state operating budget.)
All but about $2.1 billion of the state’s $9.6 billion portion of the budget — from taxes, royalties and other state-based sources — is tied up in formula-based funding for public schools and local governments. The idea of such autopilot funding was to minimize the vagaries of politics by ensuring important programs would receive adequate dollars.
Agriculture and Forestry Commissioner Mike Strain likens the budget structure to silos, in which the dollars for one program cannot be legally shifted to plug holes in another service.
Strain’s department, for instance, does the health and safety inspections at meat-packing plants, which without those inspections are required to stop operations.
Strain was given legal authority to use about $660,000 of self-generated revenue to help offset a $2.4 million reduction in the department’s annual budget, he said. Coupled with the purchase of new technology and computer programs, he said, his department should continue to operate without significant loss of service levels.
His concern — and he met with his financial people Friday to figure it out — was the Edwards administration’s order to set aside 5 percent of this year’s appropriation just in case the corporate sales tax collections remain lower than anticipated, thereby throwing the budget out of balance.
“ ‘Be prepared’ means starting now down the path of cutting it out of your budget. It means you better not spend it,” Strain said.