- Associated Press - Sunday, November 27, 2016

BATON ROUGE, La. (AP) - Lawmakers are bristling at the possibility of yet another round of cuts to colleges, after taking a hatchet to higher education financing for years. But with Louisiana struggling through its 14th midyear budget gap in nine years, it seems unlikely campuses can escape unscathed.

That number, a tally delivered to the joint House and Senate budget committee, is stunning: Louisiana has closed 13 midyear deficits since the 2008-09 fiscal year.

With a $313 million gap facing the governor and lawmakers now, “this makes 14,” Barry Dusse, director of the governor’s Office of Planning and Budget, told the committee.

“Time to stop, isn’t it?” replied Sen. Francis Thompson, D-Delhi.

Easier said than done.

Louisiana’s budget has been in tatters for years, nearly the entire eight years Republican former Gov. Bobby Jindal was in office.

A Hurricane Katrina recovery boom dried up shortly after Jindal entered office, but only after large personal income tax breaks enacted by Jindal, Democratic former Gov. Kathleen Blanco and lawmakers kicked in right as the post-storm state tax bump disappeared.

Rather than match Louisiana’s spending to its tax collections, Jindal and lawmakers patched their way through budgets year after year, scraping money out of savings accounts, draining trust funds, selling property and using one-time fixes.

Each year, a new gap appeared because the structural imbalance was never repaired.

Democratic Gov. John Bel Edwards inherited the mess, and he and lawmakers have largely stopped relying on the one-time fixes Jindal used - not that there are many savings accounts to raid anymore.

After making his own round of cuts, Edwards sought tax and fee increases. At the governor’s urging, lawmakers raised an estimated $1.6 billion earlier this year to fill holes in the current $28 billion state operating budget. That was short of what Edwards wanted.

Republican legislators thought economists low-balled estimates of what the tax hikes could raise and more money would come in than projected.

Instead, declines in private-sector Louisiana jobs are hammering personal income and business tax collections, and the amount of tax breaks paid to businesses continues to soar, despite legislative efforts to scale back the spending.

The state faces a $313 million deficit from the budget year that ended June 30 and warnings that tax collections are coming in lower than expected this year, creating another gap whose price tag will be projected in December.

Commissioner of Administration Jay Dardenne, Edwards’ chief budget architect, said tax collections could be anywhere from $100 million to $500 million short of the forecast used to build this year’s budget.

Louisiana’s unemployment rate is 6.4 percent, third-worst among states. The Legislature’s chief economist, Greg Albrecht, has described Louisiana as in a recession.

“We are losing jobs every month,” he told lawmakers. “The revenue base is just not going to generate as much money.”

To close the $313 million gap, Edwards proposed to reshuffle financing, cut some agencies and delay $152 million in payments to health providers that care for Medicaid patients until next year.

While some lawmakers criticized the Medicaid payment postponement as poor financial policy, the piece of Edwards’ plan that drew the loudest complaints is an $18 million cut to colleges.

The hit would come on top of $700 million in state cuts to higher education during the Jindal era - and on top of a first-ever reduction to the TOPS free college tuition program. For some lawmakers, that’s too much slashing.

Edwards could make the higher education reduction without legislative support, but he agreed to postpone the entire budget-rebalancing plan until December to negotiate with lawmakers.

To spare colleges, the governor could carve out money from the state’s road repair budget, prison system or some other area similarly proposed to be left untouched. He could make a deeper cut to the health department than planned, as some lawmakers suggested.

But with another budget gap already looming, it’s questionable that higher education can dodge the chopping block permanently.

Before the governor agreed to postpone his plan to close last year’s deficit, Dardenne warned lawmakers: “Today’s the easy day, relative to what you’re going to be facing.”

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EDITOR’S NOTE: Melinda Deslatte covers Louisiana politics for The Associated Press. Follow her at https://twitter.com/melindadeslatte


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