State budget deficits are $70 million and $750 million - even af - FOX 8 WVUE New Orleans News, Weather, Sports, Social

State budget deficits are $70 million and $750 million - even after tax hikes

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(WVUE) -

The deficit for the current state government fiscal year is officially more than twice the amount initially thought even after some taxes were increased in the special session that ended recently.

Gov. John Bel Edwards is pointing the finger at state lawmakers who did not embrace all of his proposed solutions for the current budget crisis and the funding shortfall for the fast approaching new fiscal year.

When the special legislative session ended last week, it was thought that the deficit for the current fiscal year would be $30 million, but soon after there were rumblings that the figure would be much higher.

On Wednesday, state economists went before Louisiana Revenue Estimating Conference which sets the official revenue projections for state government.  The focus at the meeting was on revenue that would be generated from actions taken by lawmakers during the special session. When the session began, the deficit for the 2015-2016 fiscal year was nearly $1 billion, and the shortfall for the fiscal year that begins July 1 was $2.1. billion.

State lawmakers who began the regular legislative session on Monday were waiting for the official deficit and revenue numbers.

"Give us a good base to work from so we know exactly what it is. I understand the House Appropriations Committee is ready to start working,” said Senate President John Alario, R-Westwego.

During the special session, enough consensus was reached to increase state taxes on alcohol. The state sales tax was also raised a penny from 4 cents on a dollar.

"We call it the new penny bill where we're raising a brand new fifth penny,” said Legislative Fiscal Office Chief Economist Greg Albrecht during the meeting.

The Revenue Estimating Conference is made up of an independent university economist, the president of the State Senate, the House speaker, and the governor or his designee. Commissioner of Administration Jay Dardenne sits on the panel for Edwards.

The REC accepted estimates that an additional $300.7 million will be generated from the special session items for the current fiscal year and $1.2 billion for the new fiscal year.

Still, because Republicans in the House rebuffed some of the governor’s revenue-raising measures the REC was told by state economists that the remaining deficit for the current fiscal year is around $70 million, more than double the amount first thought; the deficit for the new fiscal year is $750 million, less than the $800 million said at the end of the special session. Still, more budget cuts will be necessary since the deficit for the current budget year must be erased by June 30.

"So it's a big challenge coming up, we can't under the law, and under the constitution we can't raise any revenues during this session, so were going to have to try to whittle that down as much as we can,” said Alario.

State-funded colleges and universities are already absorbing a nearly $30 million shortfall in funding for the TOPS college scholarship program and now more cuts may be on the way to not only higher education, but also state health services.

"We just heard these numbers, we are going to be meeting with DHH, meeting with higher education, medical schools, the private contractors on the public private partnerships and talk about how we spread these cuts,” Dardenne said.

But Dardenne is hopeful that despite the need for more cuts, higher educational institutions will not have to close.

"We hope not. I don't expect any institutions to shut down,” he told reporters.

Given the ongoing deficits, another special session after the regular session ends is anticipated.

"I don't know how we avoid not going into another special session after this is over, but hopefully there's a way to avoid it,” said Alario who has been in the legislature for 44 years and is viewed as an expert on the state budget.

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