Lawmakers back Jindal administration's plan to close Louisiana's $170M midyear budget deficit

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BATON ROUGE, Louisiana — Gov. Bobby Jindal's plan to use a mix of patchwork financing and modest cuts to close a budget deficit topping $170 million won approval Thursday from state lawmakers, who had only a few days remaining to rebalance the budget and avoid a special session.

Minor changes were made to the plan submitted last month by the Jindal administration. Some financing sources were swapped. Agriculture department job cuts were scrapped. A cut to road maintenance work was eliminated.

Otherwise, the plan to rebalance the $25 billion budget for the fiscal year that ends June 30 stayed largely intact when it was approved without objection by the Joint Legislative Committee on the Budget.

"I feel comfortable with it," said committee Chairman Jim Fannin, R-Jonesboro.

The deficit appeared when the state's income forecasting panel dropped its projections for how much money the state is expected to receive from taxes and fees.

About $37 million in cuts will be made, mainly by not filling vacant jobs, reducing contracts and spending fewer dollars on travel and supplies. The rest of the gap will be filled with excess funds, like dollars from a tax amnesty program, insurance settlement, recent property sales and uninsured motorist penalties.

Across state agencies, more than 160 vacant jobs will be eliminated and dozens more won't be filled for the remainder of this budget year. The state will lessen spending on public school testing contracts and mentor programs for at-risk youth.

Nearly $4 million will be saved because Louisiana's voucher program that sends students to private schools with taxpayer dollars had fewer students than expected. Health care contracts at state prisons will shrink.

"I think it is a reasonable plan to go forward with," said Legislative Fiscal Officer John Carpenter, the Legislature's chief budget analyst.

At least one set of modifications to make the plan work will be needed in the coming months, however.

The Jindal administration wanted to use some amnesty money and other sources of piecemeal financing that haven't yet been approved for spending by the Revenue Estimating Conference, the state forecasting panel.

Once the panel approves the spending, lawmakers will have to plug that money into the state health department's budget within the next few months, or the department will have to make $45 million in cuts to comply with the budget revisions made Thursday.

"The funds are available. We need the recognition to spend them," said Commissioner of Administration Kristy Nichols, the governor's top budget architect.

The Revenue Estimating Conference dropped the revenue forecast last month because of slumping severance tax and mineral royalties from dropping oil prices, combined with weak growth in personal income taxes.

Lawmakers are worried they'll have to make more cuts before the fiscal year ends.

"With the price of oil continuing to plummet, we're probably going to be back down this road," said Sen. Mike Walsworth, R-West Monroe.

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