It took a few weeks for the pitfalls to emerge in the governor’s $25 billion budget, but the time of judgment has finally arrived.
The proposal was presented to lawmakers Jan. 24; debate commenced in earnest when the regular session convened March 10; and it must be balanced and passed by adjournment June 2. That’s roughly a month before the budget’s spending plan will be triggered by a new fiscal year July 1.
Over the past four weeks, a campaign of follies has spilled out of the budget process, beginning with the double counting of money that was collected during last year’s tax amnesty program. That pratfall led to a $43 million hole in the health and hospitals budget.
The administration said it was filled almost immediately with bond premiums and over-collections funds. But unless the administration has more from where that came from, it diminishes the pool of emergency money should any other unanticipated shortfalls occur.
And they have. Since then, Superintendent of Education John White has admitted to another $105 million gap in his budget — $55 million for the current fiscal year and $50 million for the next. He blamed both a “cash-flow” issue that has managed to survive legislative scrutiny without further explanation and a miscalculation in the amount of student enrollment growth. White’s department estimated 3,500 students when the figure was actually more than 7,000.
With nearly $1 billion in short-term financing propping up Gov. Bobby Jindal’s budget, the challenges won’t be packed up when he leaves office. In reality, they may even be worse next year, when the federal government is threatening to withhold $307 million in Medicaid money until the administration can further explain its plan for providing health care to Louisiana’s indigent and uninsured.
One the most worrisome trends are the number of agencies, departments and offices that are no longer relying solely on dedicated and self-generated revenues.
Jindal’s budget takes $12 million in hurricane recovery money and redirects it to the developmentally disabled. It swipes $23 million from the Medicaid Trust Fund for the Elderly — which has gone from $800 million to $30 million in recent years — and moves it over to home and community-based health care.
Another $6 million in wind damages from Hurricane Gustav are being funneled to the Department of Corrections. Then there’s the $50 million the administration wants to remove from the Morial Convention Center to give to the Board of Regents, Office of Elderly Affairs, Department of Education and state libraries.
So with new shortfalls cropping up, non-recurring revenue being used creatively and the usual shifting around of money, what’s a lawmaker to do? Cut. On the chopping block are $60 million worth of pay raises for state workers; $40 million for a higher education incentive fund (known as WISE); and $6 million in new money for colleges and universities.
And it’s not just the operating budget, found in HB 1. The annual construction budget, or HB 2, already has twice the amount of projects than there is capacity. There also hasn’t been a proper Minimum Foundation Program budget passed for elementary and secondary schools since the 2011-12 fiscal year, and the latest incarnation, found in SCR 55, holds just as much doubt.