BATON ROUGE, La. (AP) - Called back for an unpleasant task, Louisiana’s lawmakers return to Baton Rouge on Monday for a special legislative session aimed at rebalancing a deficit-riddled budget and deciding how deeply they’ll slash state spending to close the $304 million hole.
The main debate will involve whether lawmakers want to use a state savings account as a short-term fix or whether they’ll make larger cuts with a goal of permanently shrinking the footprint of state government.
Here are five things to know about the special session:
SESSION DETAILS
Gov. John Bel Edwards called the 10-day session to begin Monday at 6:30 p.m. Edwards speaks to a joint gathering of the House and Senate at 7 p.m., outlining his proposals for rebalancing the budget.
The Democratic governor set the parameters for the session. He’s allowing lawmakers to consider fee increases to pay for government services - but tax hikes are off the table.
Time to complete the budget work is short. The session must end by midnight on Feb. 22.
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WHAT CAUSED THE DEFICIT?
The $304 million deficit opened up when Louisiana’s income forecasting panel downgraded state tax collection estimates to account for unemployment that is dragging income, business and sales taxes below expectations.
The $27 billion state operating budget for the financial year that ends June 30 must be rebalanced this month.
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THE GOVERNOR’S PLAN
Edwards’ plan recommends cutting about $60 million in state agency spending and using more than $240 million in reserves and other financing to close the hole. He’s not seeking fee increases, though he’s allowed lawmakers to consider them.
Rather than rely solely on cuts, the governor wants to take just under $120 million from Louisiana’s “rainy day” fund and tap into another $120 million in patchwork financing, dollars from better-than-expected tax and fee collections and other financing sources to fill gaps.
Colleges, prisons, K-12 public schools, the TOPS college tuition program and the state child welfare agency would be protected. Cuts would hit the privatized charity hospital services, medical school training programs, roadwork, outreach services for the homeless, economic development marketing and the Office of Juvenile Justice. Vacant jobs wouldn’t be filled. Dollars for supplies, travel and equipment would be trimmed.
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REPUBLICAN PUSHBACK
Before the session was called, House Republican leaders questioned the need for one, saying the governor and the Legislature’s joint budget committee have the authority to close the budget gap on their own. Edwards said that limited authority would force reductions too heavily on colleges and health services and he needed the full Legislature to more broadly spread the cuts.
After Edwards released his deficit-closing plan, some GOP lawmakers said it contains too many short-term fixes and too few long-term cuts. They said Louisiana needs to permanently pare back its spending, rather than patch its way through another budget year.
The governor described his approach as responsible financial management, until the state can make long-term changes in its budget and tax structure in the regular legislative session that begins in April.
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THE RAINY DAY FUND
A centerpiece of Edwards’ plan, using the rainy day fund, requires support from two-thirds of the House and Senate. It’s far from certain the governor can win such hefty backing for the idea in the majority-GOP Legislature, particularly in the more conservative House.
The Budget Stabilization Fund topped $853 million eight years ago, but lawmakers siphoned off money repeatedly at the request of former Gov. Bobby Jindal to lessen budget gaps. It totals nearly $360 million today, and lawmakers can tap up to one-third.
Republicans are split on whether they’ve used the savings account too much and should skip it this time. But the only plan Edwards offered assumes use of the rainy day fund. If lawmakers reject the idea - or lessen how much they’re willing to take from it - they’ll have to decide where they’ll deepen the cuts to state programs and services.
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