Analysis: Edwards, Lawmakers Get Spending Cut Suggestions
BATON ROUGE (AP) — While Gov. John Bel Edwards has focused primarily on tax increases for his budget rebalancing effort, an independent government watchdog group is offering a companion list of ideas for where to cut spending.
The recommendations from the Public Affairs Research Council of Louisiana, a nonpartisan group, could provide a roadmap for brokering compromise with Republican lawmakers who have shown resistance to filling the state's entire financial gap with boosted taxes.
If some of the recommendations are followed, they also could give cover to lawmakers who don't want to devastate public health services and colleges with cuts, but who also want to say they worked to control government's size as they asked taxpayers to fork over more.
The watchdog group, known as PAR, says Edwards and lawmakers should "submit strong and specific assurances for budget cuts, controls and cost containments prior to approving tax increases."
The Edwards administration estimates the state is short between $700 million and $800 million of what is needed to pay for everything included in this year's budget, with only five months remaining before the fiscal year ends June 30. The gaps grow to nearly $2 billion in the budget year that begins July 1, as short-term fixes used this year fall away.
The Democratic governor has proposed a "menu" of tax hikes for lawmakers to consider in a special legislative session beginning Feb. 14. But it's unclear whether Edwards can get enough support from a majority Republican Legislature to pass tax bills that in many instances require a two-thirds vote.
Some lawmakers — particularly in the House — have been resistant to the idea of tax hikes. Many Republicans say if they're going to consider taxes, they need to be coupled with reductions to state spending.
"We want to reduce government's size first, before we just start arbitrarily raising revenues," said House Appropriations Committee Chairman Cameron Henry, R-Metairie, who leads the committee where budget negotiations will begin.
Henry said: "I haven't met with an agency that says they're willing to take a cut or reduction, but what they have to realize is that we're in difficult times."
Asked for details of where to shrink spending, however, and Henry's list is short. He said $54 million earmarked to agencies for vacant jobs could be eliminated, and he said legislative staff is working to find other places where dollars can be trimmed.
Edwards said he didn't want to propose tax increases, but he described them as "the most prudent thing to do" to stave off damaging reductions to government services.
"This is the eighth straight year of revenue shortfalls. All of the relatively easy things to do in terms of cuts were done a long time ago. All of the relatively and painless things you can do to find savings and efficiencies were done a long time ago," the governor said.
PAR says more can be done to trim state spending and to assure the public that government is working to control its long-term costs.
Among the ideas from the watchdog organization are: changing the process for state worker pay raises; paying down retirement debt; cutting the legislative and judicial budgets; reforming criminal sentencing laws to shrink state prison costs; and controlling the costs of the TOPS free college tuition program.
In its report, PAR also suggests slashing $200 million across state agencies and working with colleges to consolidate academic programs in regions where duplications exist. It recommends limiting dollars sent to local governments and unlocking some protections that keep money earmarked to specific programs largely shielded from cuts.
The organization also suggests the governor and lawmakers should reduce state spending on tax break programs, cutting those that don't serve "an important state purpose." Among those it recommends for elimination: an income tax deduction for private school tuition and a rebate given to property insurance policy-holders for money paid to help support Louisiana's insurer of last resort. Those two cost $69 million a year.
"Every large and small solution — whether it be a spending item or a revenue stream — matters greatly in this discussion," PAR wrote.
– by AP Reporter Melinda Deslatte