Gov. Bobby Jindal's administration says $76M savings target for this year's budget is on track

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BATON ROUGE, Louisiana — Gov. Bobby Jindal's top budget officials said Monday the state will reach the nearly $76 million in state general fund savings the administration promised to keep this year's $25 billion budget balanced.

The Jindal administration hired an outside consulting firm, New York-based Alvarez and Marsal, last year to recommend ideas to save the state money, improve government operations and generate new dollars for the budget.

Based on those recommendations, Jindal's budget architects assumed $75.7 million less in state general fund money would be spent this year across nearly a dozen agencies, and lawmakers built that into the budget.

The Senate Finance Committee sought an update Monday, asking for an agency-by-agency review of whether those savings were on track.

Ruth Johnson, overseeing the consulting contract for Jindal's Division of Administration, said agencies expect to exceed the savings included in the budget, by about $6 million.

"Overall, I can tell you that we are two-thirds of the way there. Five months into the fiscal year, we're at $50 million ... In the end, we expect to get around $81 million this year," Johnson told state senators.

Cost-savings ideas included selling state property and shrinking leased space to reorganizing management structures across agencies. In some instances, department secretaries said they expect the initiatives to achieve even greater savings in later years after they have been fully put in place.

At least 389 toll-free numbers across agencies have been eliminated. Insurance coverage was lowered on state-owned ferries and barges. The state transportation department brought in $250,000 by selling advertising that is displayed on its motorist assistance trucks.

Rehabilitation and treatment programs for state prisoners were bolstered to help inmates get out of jail sooner and help keep them from returning, while more low-risk offenders now are allowed to self-report when on probation and parole.

The health department is rolling out new requirements for home health care aides to log their time through electronic timesheets rather than paper ones to cut down on overpayments. It also created a method for drawing down more federal dollars to pay 24-hour-care facilities for developmentally disabled people.

A federal funds office to coordinate state efforts to access more federal grants and tap into other available federal programs has been created.

When it began, the consulting contract — which has cost the state $7.1 million so far — generated complaints from lawmakers who said agencies should be able to find their own savings and questioned if the contract was a waste of money. Similar questions arose Monday, as senators asked why it took a consultant to discover some ideas that have been used.

After Johnson explained changes made to shrink lawyer costs for the Division of Administration, Sen. Fred Mills, R-Breaux Bridge, asked: "It took an outside consulting firm to tell y'all that?"

During his testimony, Thomas Bickham, undersecretary of the Department of Corrections, acknowledged Alvarez and Marsal "really acted as a third-party validator" of ongoing cost-cutting plans that already were being pursued by the department.

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