- Associated Press - Friday, January 24, 2014

BATON ROUGE, La. (AP) - After years of cuts, Gov. Bobby Jindal is recommending a $25 billion budget for next year that increases spending on colleges, public schools and health care services, as the improving economy bolsters state finances.

Commissioner of Administration Kristy Nichols outlined the governor’s 2014-15 budget proposal Friday to lawmakers, who packed the hearing room despite unusual icy weather across Louisiana that shut down interstates and made travel difficult.

The spending plan for the fiscal year that begins July 1 would be $624 million smaller than this year’s budget, but mainly from the loss of one-time federal hurricane recovery and coastal restoration funds. State general fund spending would grow by 2 percent, or $186 million.

“The bottom line is revenues have stabilized, and we expect them to continue to grow and keep pace with our growing economy,” said Nichols, the governor’s chief financial adviser.

The brightening financial picture was a welcome change for state officials. The Jindal administration and lawmakers have slashed spending repeatedly since 2008, as tax collections plummeted when the national recession hit at the same time as new state tax breaks.

Legislators had few criticisms so far.

“I think that things have worked out a lot better than they have in the past,” said House Speaker Chuck Kleckley, R-Lake Charles, a Jindal ally.

To make the numbers work, Jindal’s budget uses dollars generated from a tax amnesty period this year and assumes another $100 million in back-owed taxes will be collected through a similar period next year.

Nearly 40 percent of the governor’s budget would pay for health care programs, while another 30 percent would go to education.

Higher education, which has been cut by about $700 million in state financing in recent years, is slated for an increase of $53 million for workforce development initiatives, technology upgrades and the LSU agricultural center. In addition, colleges are raising student tuition costs by $88 million, which would give campuses more new money.

“Unfortunately, it’s not enough. Louisiana has cut its higher education investment more than any other state over the past five years, and the new money in this budget only restores a fraction of what’s been lost,” said Jan Moller, executive director of the left-leaning Louisiana Budget Project, which tracks state government spending.

Rep. Patricia Smith, D-Baton Rouge, said she was disappointed the governor wasn’t proposing an increase in needs-based aid for college students.

The state’s financing formula for public schools would get $12 million in increased spending for special education and technical courses and $27 million to cover the growing number of students. In addition, a one-time boost in education funding added by lawmakers last year would be included in the formula permanently.

Jindal is proposing to expand services for the developmentally disabled, six months after he vetoed similar spending plans pushed by lawmakers. The dollars would give assistance to nearly 2,500 people on waiting lists for services.

The governor’s budget would eliminate more than 1,100 state government jobs, all but 33 of them vacant, while providing $60 million in pay raises for thousands of rank-and-file state workers.

However, those same employees face a recommended 5 percent increase in their health insurance premiums next year.

Unlike in previous years, Nichols said the governor isn’t proposing to pay for ongoing programs with money from legal settlements, property sales and other revenue streams that aren’t expected to reappear year after year.

The change was designed to end complaints from conservative House Republicans who say Jindal’s use of patchwork financing has created continuing budget problems for the state.

Jindal proposes using a $160 million state surplus and $50 million in other piecemeal funds to help pay down state debt. He’s also suggesting the state put $25 million into its “rainy day” fund, though that’s far less than the $330 million owed as part of a lawsuit settlement.

Friday’s presentation was a high-level overview, with many of the financing details missing. The House Appropriations Committee will start hearings within a few weeks to comb through the governor’s budget recommendations and uncover more information.

Lawmakers will vote on a final version of the 2014-15 spending plan in the three-month legislative session that begins in March, likely in the waning days of the session.



Jindal’s budget proposal is available at: https://1.usa.gov/1aQ5dRt

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