State budget gaps remain for current year

Published 9:31 am Friday, March 22, 2013

BATON ROUGE (AP) — About $88 million expected for this year’s state budget hasn’t been received yet by the treasurer’s office for spending, lawmakers were told Friday.

Members of the joint House and Senate budget committee have expressed concerns the state will have another shortfall before the fiscal year ends June 30 and sought an update on where things stand.

The lacking funds come from property sales, FEMA reimbursements, legal settlements and fund transfers anticipated by Gov. Bobby Jindal’s administration and plugged into ongoing services, like health care programs.

Barry Dusse, director of the governor’s Office of Planning and Budget, said the Jindal administration expects all of the lacking $88 million to materialize in the state treasury before year’s end.

“We’re expecting those moneys in,” Dusse told lawmakers.

The figure has dropped from a month earlier, when a Legislative Fiscal Office analysis pegged the gap at more than $278 million.

If all the anticipated dollars don’t show up, lawmakers could be scrambling to plug another budget gap in the current 2012-13 fiscal year when they return for their legislative session in April.

Dusse said $10 million in FEMA reimbursements are available to receive from the federal government at any time, an $11 million housing fund transfer is expected in May and $1 million from a tourism promotion fund is expected in April.

Another $10 million from the lease of the New Orleans Adolescent Hospital to a private operator is expected to roll in next month when the final paperwork is signed, he said.

The largest slice of money that hasn’t arrived for spending is $56 million tied to a set of anticipated legal settlements with insurance companies. Lawmakers questioned whether those negotiations will be wrapped up in time for the dollars to be spent this year.

“Do we have final judgments?” asked Sen. Ed Murray, D-New Orleans.

“No, we’re in negotiations,” Dusse replied.

“So, how do we count it?” Murray said.

Dusse said the administration feels strongly the dollars will appear on time, but the committee asked for further details to be provided to the Legislative Fiscal Office about the ongoing negotiations.

“I’m a lawyer. I sue people, too. I wish I could count the money like you all do,” Murray said.

Other questions involved the use of the NOAH money, which Dusse acknowledged requires additional legislation to be passed by lawmakers.

Similar types of funding are anticipated in Jindal’s budget proposal for the 2013-14 fiscal year, which has yet to be considered by lawmakers.

A group of conservative House Republicans, called the “fiscal hawks,” have criticized using such piecemeal funding to pay for ongoing programs. They’ve blamed it for creating continued budget shortfalls when the dollars don’t materialize or fall away after one year.

Jindal administration leaders and a majority of lawmakers have disagreed, saying the financing is preferable to deeper budget cuts to education and health care.””

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