Jindal's $24.7B budget relies on LSU privatization

BATON ROUGE (AP) — Gov. Bobby Jindal's $24.7 billion budget proposal for next year pours hundreds of millions in patchwork

funding into public colleges and assumes hefty savings from the privatization of LSU hospitals to make the numbers work.

The governor's spending plan for the 2013-14 fiscal year was unveiled to lawmakers Friday by Commissioner of Administration

Kristy Nichols, who described it as a challenge to close a more than $1 billion gap.

"We made every effort we can to be smart about the way we deliver services in government," Nichols told the Joint Legislative

Committee on the Budget.

As many as 6,670 employees could face layoffs, most of them workers in the LSU hospital system who would have to reapply for

jobs with the new hospital operators.

The revenue department would close regional offices. No new state troopers would be trained for another year. A program that

helps elderly people apply for drug rebates and free medication would be shuttered. Middle- and upper-income parents whose

children are in the Early Steps program, which provides speech and physical therapy for young children with developmental

disabilities, would have to pay for a portion of the services.

To stay in balance, Jindal's budget requires millions of dollars in property sales, savings from legislation that hasn't passed

and the management turnover of most LSU public hospitals to private facilities.

Lawmakers, weary of five years of budget deficits, questioned those assumptions and pressed for more details about the uncertain

financing.

"What if the property sales don't happen or any of those types of contingencies? Are we going to be faced with another midyear

budget cut?" asked House Speaker Chuck Kleckley, R-Lake Charles.

The governor's spending plans strip at least

$781 million from the university-run public hospitals that care for the

poor

and uninsured, assuming that eight of the 10 hospitals will find

private operators. But only five such arrangements have been

announced, and no contracts are final.

Sen. Francis Thompson worried about the loss of health care services in his region, one of the poorest in the state, because

the governor's budget anticipates the LSU hospital in Monroe will be privatized and state funding is stripped for most of

the year.

No plan is in place with a "private partner" for the Monroe hospital.

"We're not even saying who that somebody is. I've got to have more than that," said Thompson, D-Delhi.

Nichols replied, "We have not put anything in the budget that isn't expected to fully materialize."

"That's not good enough to me," Thompson said. He added, "I'm concerned. The people of this state should be concerned. That's

not the way you plan a budget, in my opinion."

Nichols pledged that the services offered at the university health care facilities will continue.

The budget proposal doesn't anticipate expanding Louisiana's Medicaid program under the federal health care overhaul, because

Jindal is staunchly opposed to the idea.

It also doesn't include any changes tied to

the governor's proposal to get rid of state income taxes for increased

sales tax

collections, because Jindal said his plan will be "revenue

neutral," not generating additional dollars or shrinking revenue.

For the public colleges, Jindal relies on

$424 million in one-time sources of money, such as property sales and

bond refinancing,

and $75 million in tuition increases to keep Louisiana's colleges

funded at their current level.

Release of the proposal kicks off the start of legislative budget negotiations. House budget committee hearings are set to

open March 12.

The amount of piecemeal funding to be spent

on ongoing programs would grow from last year, a point expected to

generate criticism

from a group of conservative House Republicans who say the use of

such funding creates a continuing cycle of state budget

problems.

Nichols defended the use of the patchwork financing, saying stripping it would force needless reductions to critical services.

The way Jindal structured his budget, colleges would take a 19 percent hit without the one-time money.

"We don't think it's prudent to make deeper cuts than are unnecessary when additional dollars are available," Nichols said.

Across other agencies, Jindal's budget

proposal anticipates millions in savings from tax fraud prevention and

debt collection

efforts, changes to the state's juvenile justice and adult

sentencing laws and consolidation of some legal and administrative

work across multiple departments.

Jindal's budget includes minimal cuts to the health department and would keep spending rates flat for public schools for the

fifth year in a row after years of annual boosts in per-student spending.

The governor's statewide voucher program would continue to be paid through the $3.5 billion public school financing formula

while the Jindal administration appeals a court ruling that found the funding method is unconstitutional.

Louisiana's free college tuition program, TOPS, would get an annual increase to deal with the rising costs of student tuition,

bringing its price tag to $204 million.

Budget Breakdown

BATON ROUGE (AP) — Gov. Bobby Jindal unveiled his $24.7 billion budget proposal for the 2013-14 fiscal year. A look at the

total budget recommended for some of the largest state agencies, compared to the state's budget in December:

Executive Dept. (includes federal funding for hurricane response): $3.4 billion, a $532 million decrease.

Dept. of Veterans Affairs: $57.4 million, a $57,533 decrease.

Secretary of State's Office: $61.1 million, a $12 million decrease.

Attorney General's Office: $54 million, a $9.7 million decrease.

Dept. of Agriculture and Forestry: $73.7 million, an $8.6 million decrease.

Dept. of Insurance: $30.6 million, a $570,152 decrease.

Dept. of Economic Development: $41.8 million, a $16.2 million decrease.

Dept. of Culture, Recreation and Tourism: $79.5 million, a $12 million decrease.

Dept. of Transportation and Development: $547.2 million, a $6.5 million decrease.

Dept. of Corrections: $496.6 million, a $31.8 million increase.

Dept. of Public Safety: $378 million, a $65.9 million decrease.

Dept. of Health and Hospitals: $8.9 billion, a $54.2 million decrease.

Dept. of Children and Family Services: $769.2 million, a $58.3 million decrease.

Dept. of Natural Resources: $174.3 million, a $1 million increase.

Dept. of Revenue: $82.2 million, a $14.7 million decrease.

Dept. of Environmental Quality: $122.1 million, a $5 million decrease.

Louisiana Workforce Commission (labor department): $272.9 million, a $13.5 million decrease.

Dept. of Wildlife and Fisheries: $196.5 million, a $7.1 million decrease.

Higher Education (includes some reductions for LSU hospitals): $2.7 billion, a $209.7 million decrease.

Dept. of Education: $5.2 billion, a $206.6 million decrease.

LSU Health Care Services Division (budget for 7 of 10 public hospitals): $44.9 million, a $780.6 million decrease.