Credit agency says La. deficit plan was only 'stop-gap' fix
BATON ROUGE- A national credit rating agency says the maneuvers used by Gov. Bobby Jindal and lawmakers to close a $487 million midyear budget gap were only temporary fixes.
Fitch Ratings released its analysis Thursday of the work recently done to rebalance this year's $25 billion budget. The assessment was that Louisiana's leaders used "stop-gap measures" that "will not address the state's persistent budget challenges."
The credit agency said some deficit-closing actions worsen next year's budget gap pegged at more than $1 billion, and the shortfall in this year's Medicaid program.
Fitch said it is looking for Gov.-elect John Bel Edwards and lawmakers to stabilize the state's finances.
Treasurer John Kennedy called Fitch's statement a "warning shot" that Louisiana risks a credit rating downgrade if it doesn't devise a long-term budget solution.