$135 million state revenue loss predicted from low oil prices
BATON ROUGE - State revenue seems to be feeling the full effect of the drop in oil prices.
Economist Greg Albrecht with the Legislative Fiscal Office estimated a $135 million drop in revenue for the 2015-2016 fiscal year.
Louisiana's Revenue Estimating Conference (REC) predicted the average price of oil per barrel would $62 for the fiscal year. But three months into it, oil is trading at $45 a barrel.
Albrecht told the REC Friday that economists don't expect an increase in oil prices that would compensate for the current drop.
The REC's economist, Bill Richardson, said other revenue streams will most likely not compensate for the drop either.
"It might help it on the edge a little bit, but to the best of my knowledge it won't overcome that," he said.
Richardson expects the REC to adjust its oil price estimate in November.
The likely revenue loss is compounded by a spending gap in 2014-2015 fiscal year. Treasurer John Kennedy estimated Wednesday that the gap would be "well over" $100 million.
Kennedy expects the gap from last year, along with predicted mid-year budget cuts, and a predicted budget deficit for the 2016-2017 fiscal year to total $1 billion.