Louisiana Repaying $370M Cash-Flow Loan Early, Small Savings
BATON ROUGE (AP) — Louisiana is repaying early the $370 million it borrowed this budget year to keep state agencies paying their bills on time.
The early repayment will save the state $330,000 in interest costs. That's a minor amount in a multibillion-dollar budget, but officials said Thursday it will send strong signals to Wall Street and credit rating agencies that Louisiana takes care of its debts even amid financial troubles.
But Commissioner of Administration Jay Dardenne and Treasurer Ron Henson also acknowledge Louisiana may have to take out a similar loan again next year.
Before this budget year, Louisiana last took out a similar short-term loan nearly 30 years ago. Local governments regularly use the approach. The maneuver, state officials say, was needed because Louisiana has fewer reserves after years of budget raids.
– by AP Reporter Melinda Deslatte