Report: State budget's biggest problem isn't oil
BATON ROUGE - A new report released by the Louisiana Legislative Fiscal Office cast doubt Wednesday on the Jindal administration's claims that a massive budget gap is largely due to falling oil prices.
The Fiscal Office's report says the upcoming year's budget deficit was pegged at $1.2 billion before any changes in oil prices were considered. The group said nearly $1 billion of that was due to ad hoc sources of money used in the current year's budget which would have to be replaced in the 2016 budget.
Governor Bobby Jindal's administration has drawn criticism for using one-time sources of money and other savings tricks to fill previous budget gaps. Legislators voiced their concerns in the most recent joint budget commission meeting when discussing mid-year cuts, but voted to go along with the administration's plan anyway, a similar pattern to previous years' budgets.
The Legislative Fiscal Office said the recent drop in mineral revenues only made the situation more painful, adding 25 percent to the overall budget shortfall of around $1.6 billion. The report said a proposed $300 million to $400 million cut to higher education funding could help, but it wouldn't offset other rising costs such as TOPS growth.
The fiscal report also said general sales tax receipts were finally gaining traction after three years of no growth, but there was still weakness in the personal income tax which generates the most money for the state. The report also said more constitutional budget dedications implemented in the last voting cycle are eating up any revenue gains.
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