Some of the reasons for today’s budget deficit have been in plain sight for a long time.
The new Democratic governor pointed out some of them to lawmakers the other day in a speech to the joint House and Senate.
But there has not yet been a full accounting of the problem. Why? Because some of the new costs are inevitably going to be projections that will change, but should be reasonably accounted for in the new budget; we won’t know how much until some time has passed.
One of those fiscal land mines left for Gov. John Bel Edwards by former Gov. Bobby Jindal was a gap in Medicaid services; the new administration said the old one “did not properly budget for the increase in the number of people who would use Medicaid — they ignored the increase for the first time ever since the Medicaid program began.”
That is not related to expanding Medicaid eligibility, but the day-in, day-out costs of providing medical services to the indigent. Expanding Medicaid eligibility saves the state money in the next fiscal year, because of a higher federal match under the Affordable Care Act.
It was Jindal’s negligence in the ordinary course of doing business that fueled much of today’s crisis.
Legislators were jammed last year by the old administration, which on the flimsiest of grounds did not include in the budget one of the monthly payments for medical vendors. That means the new administration had to deal with 13 monthly payments involving hundreds of millions of dollars. Lawmakers did not like it, even Republican lawmakers, but the late timing of the last fiscal crunch gave the Legislature no time to act.
The new administration said that is not the only place where Jindal failed to provide for clearly anticipated expenses.
Edwards’ office said expenses were left unbudgeted that could easily have been projected for the departments of state government, including Children and Family Services, Corrections and the Office of Juvenile Justice.
“The previous administration simply chose not to include large expenses in last year’s budget in an attempt to make it artificially smaller,” Edwards’ office reported.
The recklessness of all this is pretty obvious, but it is striking that the Republican opposition to Edwards does not seem to remember Jindal’s practices, even among GOP members who were critical of Jindal’s budgets during the past few years.
While members of the House in particular begrudge every penny in tax increases, they also seem to wait and hope for revenue increases that are unlikely to materialize. We worry, based on the Jindal record, that more and larger expenses might come to light after July 1, the beginning of the new fiscal year for state government.
There might not be enough money to pay for Team Jindal IOUs, and legislators would then face unpalatable choices only months after going home. One of the big bond rating agencies put it this way: “Fitch believes these one-time actions do not address the persistent underfunding of the state’s Medicaid program and other state expenditures, such as higher education tuition system.”
Unless a reliable and recurring tax base is generated in the current tax-and-budget session, there could be surprises no one wants to see, and a call for lawmakers to return to the Baton Rouge they are today so ready to leave.