House Budget Hearings Begin With Uncertainty About Cuts

BATON ROUGE (AP) — After lawmakers raised more than $1.2 billion in taxes for next year, Louisiana government agencies still face "painful" cuts up to 30 percent of their state financing, the governor's chief financial adviser told the House budget committee Monday.

         Commissioner of Administration Jay Dardenne said the cuts for the fiscal year that begins July 1 won't be "absolutely catastrophic and shut-down government level" since the taxes were passed in a recently-ended special session.

         "But they're still going to be significant. They're going to be dramatic. They're going to have an adverse impact on a lot of the delivery of services around the state," Dardenne told the House Appropriations Committee as it opened its budget hearings.

         The committee, packed with Republicans who opposed many of the tax hikes sought by Democratic Gov. John Bel Edwards, will have to craft a budget proposal about $750 million short of what is needed to continue all programs and services next year.

         Dardenne said the Edwards administration will offer its recommendations for where to slash spending by the end of the first week in April.

         He said colleges and the state health department would face cuts of around 12 percent of their state financing, in the governor's proposal. Other agencies like the revenue, economic development, tourism and education departments could take hits of up to 30 percent of their state general fund allocation in the Edwards administration plan, Dardenne said.

         Before the administration can craft its proposals for the upcoming 2016-17 budget year, it must first rebalance this year's budget. The taxes passed by lawmakers in the special session raised an estimated $300 million for the fiscal year that ends June 30 — leaving a $70 million gap in this year's budget.

         Edwards was left to determine where to make those $70 million in cuts. Dardenne said the reductions will be unveiled by Thursday, giving agencies three months to lessen their spending.

         Higher education leaders and the health department are bracing for steep slashing to their programs. The reductions will come on top of more than $160 million in cuts already made across state government by the governor and lawmakers.

         Appropriations subcommittees are scheduled to start combing through individual department budgets next week, to determine where they'll seek to levy cuts, before they'll have recommendations from the Edwards administration.

         In the special session, lawmakers backed tax hikes on cigarettes, alcohol, car rentals and more. Business tax breaks were lessened. And lawmakers enacted a short-term, 1-cent state sales tax hike and removed some tax breaks on the state's existing 4-cent sales tax.

         The actions weren't enough to close all the holes. House Republicans blocked many additional tax increases sought by the governor. The Legislature can't raise taxes in the current regular session, and talk has started about a possible second special session on taxes to try to stave off deep cuts for next year.

         – by AP Reporter Melinda Deslatte

 

 

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