State senators approached an already gloomy budget outlook with caution on Thursday.
Several noted that they have felt misled about the state’s fiscal situation under Gov. Bobby Jindal’s administration — particularly the Department of Health and Hospitals.
“How do we have any comfort at all in knowing the numbers that we are hearing and seeing today is accurate?” asked Sen. Jim Fannin, a Jonesboro Republican who previously led the House Appropriations Committee. “I’m just trying to figure out a confidence level in the numbers I’m seeing today.”
This week was the state Senate’s turn to be briefed on the budget by Gov. John Bel Edwards’ administration and other budget advisers.
Louisiana faces a nearly $800 million shortfall in the current budget, which it must address by June 30, and a $1.9 billion shortfall in the budget that begins July 1.
But on top of questions about what the state can — and cannot — do to shore up its finances, senators raised concern over their ability to have faith in the numbers presented to them after years of plugging holes.
DHH’s Medicaid budget has seen several fluctuations since the start of the current budget last year. The department has said the increase is largely due to spikes in Medicaid enrollment. More than 80,000 new enrollees have signed on this year.
Fannin noted that in June, it was balanced. By October, it was more than $500 million short. The department said it found “internal solutions” to close the gap — savings that Fannin noted had not been initially presented. Now, the program is about $530 million in the hole.
“I don’t feel like it was accurate — what was presented (in June),” Fannin said. “It’s shocking to me.”
Jay Dardenne, commissioner of administration under Edwards, promised senators that they would get the whole picture now.
“You are going to get answers from me and this administration when you ask questions,” he told the group, which included the Senate Finance Committee and other senators who joined in. “You are going to get truthful answers. You are going to hear the truth from us.”
Sen. Karen Carter Peterson, D-New Orleans, also lamented the budget picture painted under Jindal, and she claimed the previous administration was “not completely truthful.”
“We’re hopeful that it’s a new day,” she said.
No major updates were revealed in the budget briefing. The state’s Revenue Estimating Conference will provide a picture of the budget outlook when it meets Feb. 10, but state economist Greg Albrecht said lawmakers shouldn’t get their hopes up.
“It’s almost all minus signs,” he said.
Year over year, the state is operating at a net negative on corporate income taxes, meaning the state is paying out more in refunds than it is taking in.
For the past three months, the state also has seen its employment rate slide, and oil and natural gas prices continue to tumble.
“I hope by some miracle there will be a better number, but I don’t think that’s going to be the case,” Dardenne said.
Edwards is expected to call a special legislative session Feb. 14 to address the state budget crisis.
He has asked legislators to consider a menu of tax options that could help bring in new revenue, including an increase in the state sales tax from 4 cents to 5 cents.
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