Falling oil prices could force more cuts this budget year - FOX 8 WVUE New Orleans News, Weather, Sports, Social

Falling oil prices could force more cuts this budget year

By MELINDA DESLATTE

Associated Press

BATON ROUGE, La. (AP) - The budget hole facing Gov. Bobby Jindal and lawmakers next year is grim, topping $1.4 billion. But that may not even be the worst-case scenario.

With oil prices continuing to plummet, state officials are readying for the possibility they haven't yet hit rock bottom.

They may have to deal with another deficit in the current $25 billion state budget before the fiscal year ends June 30, while next year's shortfall could grow even larger.

About 13 percent of this year's state's general fund is tied to severance taxes and mineral royalties from energy production. Dropping oil and gas prices helped create a midyear deficit earlier this year that has been filled.

But more bad news could come when the state's income forecasting panel meets in January.

(Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)

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