Gov. Edwards releases worst-case budget for upcoming fiscal year - FOX 8 WVUE New Orleans News, Weather, Sports, Social

Gov. Edwards releases worst-case budget for upcoming fiscal year

Joint Legislative Committee on the Budget (Source: WAFB) Joint Legislative Committee on the Budget (Source: WAFB)
BATON ROUGE, LA (WAFB) -

Extensive cuts to the Department of Health and Hospital (DHH) and higher education headline a budget proposal from the Edwards administration for 2016-2017 fiscal year. 

The proposal is designed to be a worst-case scenario, outlining the potential impacts if the legislature does not act during the special session to raise revenue and fill the $2 billion shortfall forecasted for the next fiscal year. 

"Whatever you want to call it, it’s the wake-up call, it’s the reality check, it’s the alarm sounding,” said Commissioner Jay Dardenne.

Dardenne presented the proposal to the Joint Legislative Committee on the Budget Saturday, a day before the legislative special session is set to begin. 

As it stands, the proposal would slash the budgets for the Department of Corrections, the DHH, and higher education by 24 percent. That amounts to $116 million less for corrections, $796 million less for hospitals, and $180 million less for colleges. 

Many other agencies would see even deeper cuts, amounting to 63 percent. This includes Veteran’s Affairs, which would lose $3.5 million, and the executive branch, which would lose $78 million. 

"I just don't see how we can survive or continue to render any services through any agency to our citizens if this is the case," said Sen. Regina Barrow, D-Baton Rouge. 

"I think you can understand that a 25 percent reduction to any of these areas is devastating," Dardenne said. 

These cuts could be avoided if the state raises enough tax revenue to fill the $2 billion hole. However, some representatives objected to this plan, insisting instead that it would be better if they had time during the session to restructure the government to find places where cuts could be made. 

"If we hit the people, the businesses of Louisiana with $2 billion of taxes, what did the guy Perot say a few years back? That great swishing sound as everyone leaves the state? That’s what’s going to happen," said Sen. Conrad Appel, R-Metairie. 

Of course, before the $2 billion budget shortfall can be fixed, the current fiscal crisis must be managed before the end of June. As it stands, the state faces a budget hole of more than $900 million for the current fiscal year. 

A few weeks ago, Governor John Bel Edwards introduced a budget proposal for this year, featuring more than $160 million in cuts coupled with increased revenue. 

Higher education, for example, would see at least $42 million cuts even if the legislature institutes new revenue. Colleges will also have to bear TOPS costs that the government will no longer pay for totaling $28 million. On the tax end, the proposals include a one cent increase to the sales tax as well as a reduction in corporate tax credits. 

The proposal for the current fiscal year received mixed reviews from legislators. 

"I would tell you honestly that most people think we just need to live within our means, and that we shouldn’t raise revenue," said Rep. John Schroder, Sr., R-Covington. 

"We’re talking about closing the loopholes so that people who are paying taxes are also in the same category as large businesses that are paying none," said Sen. JP Morrel, D-New Orleans. 

The committee will meet again Sunday before the special session begins. During that meeting, representatives from DHH and higher ed will explain to members of committee the exact implications of such budget cuts during this fiscal year. 

Then, Sunday afternoon, the special session officially begins. 

Copyright 2016 WAFB. All rights reserved.

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