Commissioner of Administration Paul Rainwater. (Associated Press)
Last Modified: Friday, September 21, 2012 2:43 PM
BATON ROUGE (AP) — Louisiana closed the last fiscal year with a $130 million surplus, the Legislature's economist told a state income forecasting panel Thursday. Disagreements have already emerged between top officials over how to spend the unbudgeted money.
Greg Albrecht, the chief economist for the Legislative Fiscal Office, said the better-than-expected financial performance for the budget year that ended June 30 was largely tied to business tax collections, which were significantly higher than the forecast.
"The strength here turned out to be corporate," Albrecht told the Revenue Estimating Conference.
Opinions differ on how the money can be spent.
Commissioner of Administration Paul Rainwater, the governor's chief budget adviser, wants to use the money to fill a $94 million hole in the state's Medicaid program, to avoid deeper cuts to the LSU hospital system and other health care services.
But House Appropriations Committee Chairman Jim Fannin, D-Jonesboro, said a law passed by the Legislature earlier this year requires the first draw on leftover cash must be used to repay a recent withdrawal from the state's "rainy day" fund.
"That would be how I view it," Fannin said after the estimating conference meeting.
In a budget bill sponsored by Fannin, lawmakers required funding up to $204.7 million to be used to replenish the state's "rainy day" fund, which was tapped to fill a deficit that cropped up last year.
The Jindal administration claims the rainy day fund repayment provision passed by lawmakers only applies to dollars recognized before the fiscal year ended. Fannin disagrees.
If lawmakers agree to disregard the repayment provision, questions remain about limitations governing how dollars deemed an official surplus, called "nonrecurring" revenue, can be used.
The state constitution allows the money to pay for bond payments, retirement debt, construction projects, coastal restoration projects and rainy day fund contributions.
Decisions on the spending are expected to be debated during the next regular legislative session, which begins in April.
Albrecht said the state collected $212 million more in revenue for the 2011-12 budget year than the $7.9 billion state general fund estimate adopted in April, but he said lawmakers included $82 million of that income in the current fiscal year budget.
That leaves $130 million unallocated and available for spending. And this year's budget outlook also could improve.
The current year forecast anticipates growth of less than 1 percent from what was actually collected in state general fund income last year, Albrecht said, calling it a likely underestimate of what should be expected.
"That would be a bad year. It's hard for me to believe that we would end up with that kind of year," he said.
The revenue forecasting panel didn't make any changes Thursday to this year's income estimates, however, leaving that discussion for another meeting.
Posted By: Margaret Scott On: 9/21/2012
They borrowed from the "rainy day" fund; therefore, there is no surplus. They have to replenish the fund. Then, if they need to borrow again for necessary expenditures, they can. Put more simply, if I borrow $10 from you for lunch and my lunch costs $8, the remaining $2 should go back to you--and I still owe you the other $8, too.
Posted By: Steve A On: 9/20/2012
How about trying to allocate that surplus to places like Moss Regional...........Duh