Top budget architect: Louisiana’s deficit will wreak havoc on every service government provides
Louisiana Gov. John Bel Edwards seeks public support for sweeping tax increases to help combat the state’s deep budget crisis. Republicans are resisting.
Edwards hoped to drum up more public support Thursday delivering a statewide televised speech.
The state’s chief budget architect Jay Dardenne says he thinks Louisianans are desensitized. They’ve weathered eight years of mid-year cuts. But now, Dardenne says, there aren’t any pots of one-time cash left to keep government services intact.
“Every amount of dedicated funds was swept in order to keep the ship afloat with no structural changes in government,” Dardenne said. “Despite the fact that we have a significant reduction in the number of state employees, there was no significant corresponding reduction in the money that was out there.”
State Treasurer John Kennedy says the state’s budget has gone up 40 percent over a decade, while the economy in that time grew by 25 percent measured by gross domestic product.
He says there are thousands of pricey consulting contracts that need to be scaled down or scrapped. He thinks there is excess money in the budget to restructure spending without resorting to widespread tax hikes. That move by Edwards, he says, will tank the economy.
“What he’s basically saying is: I want Louisiana businesses and Louisiana families to cut their budgets and give that money to state government so state government doesn’t have to cut its budget,” Kennedy said.
Commissioner of Administration Dardenne says the Edwards administration will look at every available option to solve the debt crisis for good. He doesn’t think a loan is a viable option, at least for now.
“You have to collateralize whatever money you’re borrowing and we’re not at that point yet where we’re considering doing that. I imagine the Legislature may want to talk about that some while they’re in session. We’re open to whatever option we may be able to consider that’s responsible,” Dardenne said.
Louisiana has a budget gap of at least $870 million that must be closed by June 30. But Dardenne told Red River Radio Thursday that the red ink is more like $941 million this fiscal year.
Universities are feeling the crisis. Payments to Louisiana's colleges from the TOPS free college tuition program were put on hold Thursday due to the budget uncertainty.