La. Budget Shortfall Tagged at $1.5B, with Legislators Skeptical

BATON ROUGE, La. (LOCAL 33) (FOX 44) - A joint group of state representatives and senators accepted the official forecast Friday of a "fiscal cliff" $1.5 billion high, to hit once the next budget year begins June 30. But that projection came with heavy skepticism from lawmakers, many of whom suspect the shortfall is hundreds of millions of dollars lower.

"We have a lot more people looking at numbers today than we used to have," Sen. Jim Fannin (R-Jonesboro) told state economist Greg Albrecht inside the Joint Legislative Budget Committee room. "I hope you're sensitive when you put these numbers in place."

Roughly $1.1 billion of the shortfall involves the expiring one-cent sales tax, enacted last year as a temporary source of state revenue. Another $440 million, argue state budget officials, accounts for rising state expenses, including public salaries, K-12 education and Medicaid costs long delayed.

"That's just the net effect of all 40 some-odd state tax revenue resources," said Albrecht.

The legislators remained skeptical.

"I understand projections are difficult, said Sen. Sharon Hewitt (R-Slidell). "But who the heck knows what the real number is?"

"We will," Albrecht replied. "We will get a count on these numbers."

"In a year from now," Hewitt remarked.

Gov. John Bel Edwards' chief budget adviser, Commissioner of Administration Jay Dardenne, also believes a $1.5 billion projection is too far north.

"The five-year forecast, by statute, includes medical inflation, and those numbers ratchet up the cliff," he said. "But the more realistic number is closer to $1.1 billion."

No matter the more accurate projection. Dardenne noted that legislators, over the past three sessions, could not agree on a way to avert a 2018 shortfall. He warned that if the state House and Senate cannot reach a deal before the March session convenes, he and Gov. Edwards will draft a fiscal outline featuring at least $1.1 billion in cuts.

 

"The budget I will present for next year will not be a budget the governor or this administration want," said Dardenne. "But it will be a budget that reflects the billion-dollar shortfall."


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