You know the Louisiana state budget situation is desperate when the solutions being suggested go from the questionable to the ridiculous. None of the ideas advanced so far appear to come close to closing a $1.6 billion deficit projected for the fiscal year beginning July 1.
Higher education, the one great hope for a better tomorrow for the state’s young people, has been severely crippled by the Gov. Bobby Jindal administration. Colleges and universities have already been cut to the tune of $700 million since Jindal took office in 2008 and face a $400 million reduction for the 2015-16 fiscal year.
A local attorney who has been bothered for some time by the hits to colleges and universities said, “We have spoken before about the lack of leadership killing our state’s higher education system. Until now, the death has been slow – too slow for most to see or care. However, there is no question that we are in an emergency now. Amazingly, no one is treating it like an emergency. We hear the same rhetoric with promises that our leaders are working on a fix.”
Making matters worse, Moody’s Investor Service has notified the state its rating committee will meet later this week to decide whether to drop Louisiana’s credit rating because of its poor budget practices.
State Treasurer John Kennedy, who was in on discussions with Moody’s, said a downgrade would cost taxpayers more interest, and would be “a blow to our status.” He said legislators are committed to fixing the budget problems, but those changes could take two to three years.
Kristy Nichols, state commissioner of administration, used a Fitch’s AA bond rating to say, “This rating affirms that our approach to the upcoming budget is the right one. We are creating sustainable changes that ensure we can present a balanced budget that does not raise taxes, uses fewer non-recurring sources of revenue and provides options for reducing the impact on higher education and health care.”
Leave it to Nichols to find something to try and protect her boss. It’s her supercilious attitude surfacing again.
We won’t know exactly what Nichols has in mind until the governor reveals his budget proposal on Feb. 27. However, we got some clues Wednesday. The administration is reported to be looking at current tax credits, selective tuition increases and new service fees.
You will notice that all of those ideas protect Jindal’s pursuit of the presidency because they don’t involve new taxes or the end of major tax breaks to produce additional revenues. But most are simply taxes with a different name.
The Associated Press offered an excellent explanation of how Jindal has put budgets together by raiding trust funds, special funds and insurance reserves.
A trust fund for the elderly that had $832 million seven years ago will be almost drained by this June 30. A $500 million health care reserve fund held by the Office of Group Benefits is down to $123 million. The state’s rainy day fund has gone from $776 million in 2008 to $445 million this year, and Jindal’s successor will have to use part of what’s left for a legal settlement.
The governor has raided reserve funds across state government, and the treasurer’s office said reserves have dropped from $9.3 billion when Jindal took office to $6.8 billion today. And some of what’s left is untouchable or it might be gone as well.
The AP said some of those funds were supposed to go for postconviction DNA testing for the poor, state park repairs, litter prevention, oyster sanitation, seafood marketing, derelict crab trap removal, reptile research and tobacco regulation.
Slot machine proceeds that were supposed to pay for services for the blind were used to plug budget holes. The administration also took some $45 million that oil and gas companies had donated to turn old drilling rigs into artificial reefs that help attract marine life, create fishing spots and aid in coastal restoration efforts.
What a sorry state of affairs to use funds for such important purposes in order to avoid higher taxes or other revenue solutions. How has state government sunk to such lows?
We mustn’t forget that a majority in the Louisiana Legislature was a full partner in these devious tactics because it didn’t have the guts to buck a governor who appears to have lost his financial sense of direction.
OK, now to the ridiculous. Billy Nungesser, a candidate for lieutenant governor, wants to eliminate the state’s income tax.
Has the former president of Plaquemines Parish been living in a cocoon somewhere? Jindal tried that in 2013 and dropped it like a hot potato.
Kennedy, the state treasurer, has seized this occasion to again promote the cutting of state consulting contracts. A bill to reduce them by 10 percent passed both houses unanimously last year, but it was vetoed by Jindal. Kennedy also thinks there are savings in the state’s health care system.
“At some juncture, there’s a tipping point,” Kennedy said of the higher education cuts. “Classes fall off the curriculum. The departure of professors turns into a stampede. Campuses turn into ghost towns. That’s the situation we’re creating with each snip to the education budget.”
It’s past time for legislators, taxpayers and alumni of the state’s colleges and universities to rally to their cause. Most of the solutions being considered by the Jindal administration appear to be more of the same ideas that have fallen far short of what’s needed to save higher education.
JIM BEAM, the retired editor of the American Press, has covered people and politics for more than five decades. Contact him at 337-515-8871 or [email protected]? .