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Wednesday, April 17, 2019

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Jindal plan to close $487M budget deficit wins approval

Jindal plan to close $487M budget deficit wins approval

BATON ROUGE, La. (AP) — Gov. Bobby Jindal's plan to rebalance the state's budget and close a $487 million deficit received overwhelming support Friday from state lawmakers, who backed a stopgap approach that leaves hefty problems for Louisiana's next governor.

Members of the Joint Legislative Committee on the Budget said they expected to face budget troubles again in only a matter of months, but they set aside those worries and said the governor to take office in January will need to address the state's larger financial woes.

"This is not a perfect plan. This kicks some things down the road again," Senate President John Alario, R-Westwego, said as he urged passage. "But at least it gets us through this crisis right now."

Lawmakers didn't heed calls from both candidates in Saturday's runoff election for governor, Democratic state Rep. John Bel Edwards and Republican U.S. Sen. David Vitter, to reject the deficit plan. Neither spoke at the committee hearing, though Edwards talked to some of his colleagues privately before the vote. Neither offered an alternative proposal.

House committee members voted 19-6 for the Jindal plan, while senators backed it 14-1. The votes gave the governor the green light to roll out the mix of cuts, patchwork financing and other maneuvers that will rebalance — at least for now — the $25 billion budget for the fiscal year that began July 1.

"This proposal allows Louisiana to prioritize higher education. It allows Louisiana to prioritize public safety. And it allows Louisiana to prioritize its vulnerable populations," said Commissioner of Administration Stafford Palmieri.

Public colleges will be spared cuts. Mainly short-term fixes will be used to close gaps temporarily. The "rainy day" fund will be tapped. A huge internal shortfall in the state Medicaid program won't be addressed. And payments to some health care providers who take care of Medicaid patients will be delayed for two weeks, pushing those payments into next year.

Lawmakers raised concerns about stripping $6.5 million from the state's coastal restoration office in a state battling erosion and $46 million from the state's transportation department amid a $12 billion backlog of road and bridge work.

But they also had concerns that if they rejected Jindal's ideas, the alternative was to slash college campuses, which they had made a priority for protection.

Rep. John Schroder, R-Covington, refused to support the deficit elimination plan.

"We're just going to smoke-and-mirrors our way through this, and then we're going to have to deal with this in the very near future," Schroder said. "This clearly isn't fixing anything."

The nonpartisan Legislative Fiscal Office said the plan made $23 million in actual cuts to state government operations. The rest of the list shuffled money around or pushed problems into the second half of the current budget year or the next budget year.

Of particular concern to committee members was $126 million the Jindal administration described as an "anti-fraud" initiative in the state health department that postpones payments to health care providers by two weeks.
Palmieri said that gives the department time to closely check for fraud — but the net effect, lawmakers noted, is the maneuver pushes payments for services into the next budget year.

"We're not going to find $126 million in fraud. We're just slow-paying the providers," said Sen. Dan Claitor, R-Baton Rouge.

"This is cash flow management," Palmieri replied.

One piece of the plan needs further approval: To use the $28 million in "rainy day" fund cash requires support from two-thirds of the full Legislature through mailed ballot by mid-December.

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