Grim Louisiana budget picture takes shape; special session likely

Grim Louisiana budget picture takes shape; special session likely

BATON ROUGE, LA (WVUE) - Louisiana's Senate president said the state's scholarship program, TOPS, may be left alone for the rest of this fiscal year. But other cuts are coming as a grim budget picture takes shape, and there is little doubt the governor will call a mid-February special session to deal with it.

A battery of state economists presented a grim picture on Friday.

One economist said the deficit may be as low as $308 million, but another said that a billion-dollar deficit is more like it.

"Overall in the forecast, we need to reduce the general fund by $500 million," said Louisiana's chief economist Manfred Dix.

The revenue estimating conference decided to accept a $308 million deficit.

"These are going to be very serious cuts. There's no way around that," said Commissioner of Administration Jay Dardenne.

The budget shortfall will likely trigger a February special session to address a myriad of cuts.

"I'm hoping the legislature goes along with using the rainy day fund. If not, we will be cutting universities an additional $60 million and healthcare would be cut an additional $60 million. That will be devastating in both of those areas," said Revenue Conference Committee member and state Senate President John Alario (R-Westwego).

But tops scholarship money may not be cut further, at least for now.

A big part of the problem is that the state has been losing jobs since the price of oil began its steep decline in August 2014.

"I'm not saying it's turned around yet. Maybe (it turns around) later, but we're still losing jobs," said Greg Albrecht with the Louisiana Legislative Fiscal Office.

The committee was also disappointed to learn that sales tax proceeds from Amazon were only around $1 million a month much lower the many had hoped.

"Everybody was excited. Through the years we've seen our sales taxes dropped off because of internet sales, a lot of people shopping on it and that's part of the reason," Alario said.

As has become all too usual, the road ahead will not be easy.

"Now, they've got to a point where they can't absorb any more cuts were talking about health care and higher education. We're not sure where we can cut in corrections other than closing facilities," Dardenne said.

State lawmakers begin the task of trying to balance a budget that is still hundreds of millions of dollars out of whack.  State gaming revenues are also way below projections. Economists say people have less discretionary income and a smoking ban at Casinos may also be to blame.

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