Jindal proposes cutting state budget by $1.2 billion

Jindal proposes cutting state budget by $1.2 billion

NEW ORLEANS (WVUE) - The Jindal administration's budget proposal for operating state government calls over $1 billion in spending cuts.

That would result in fewer state jobs, less refundable tax credits and a possible cigarette tax hike.

The administration says it wants to reduce the new budget by 4.7 percent, or $1.2 billion dollars.

Governor Jindal did not make the $24 billion dollar budget presentation himself; it was his Commissioner of Administration Kristy Nichols.

The state faces a $1.6 billion dollar shortfall for the fiscal year starting July 1.

Funds for state health care and higher education would be reduced, but not by as much as earlier thought. The governor's staff says the TOPS program would be fully funded, and Jindal's budget lets colleges increase tuition.

Jindal proposes spending $526 million less on 12 current refundable tax credits. The money saved would be split between the Department of Health and Hospitals and higher education.

The tax credits include the huge inventory tax credit, one for musical and theatrical projects and research and development projects.

The Jindal administration says reducing spending on the tax credits will not be a burden for Louisiana tax payers.

727 state government positions would also be eliminated, but Nichols said most are unfilled in higher education. The net number of layoffs would be less than 70.

If the legislature approves a hike in the cigarette tax, Nichols says the administration would go along with that as long as it is offset by another tax credit, like one that would give parents a tax credit for an increase in college tuition which is also on the table.

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