News

When Good Budgets Go Bad

by Jeremy Alford

Written by Jeremy Alford
Wednesday, April 14, 2010

Lawmakers are working with piecemeal data, non-profits are scrambling for attention, and the push to increase state revenues becomes ever so taxing.

Many of the same lawmakers who were freely spending surpluses just a few years ago are now looking for ways to close a $3 billion budget gap that will take hold July 1 and not let go until June 31, 2012. One way to address the cliff is to pull back - on expenditures, that is - but that's hard to do when the breaks won't cooperate.

Written by Jeremy Alford
Wednesday, April 14, 2010

Lawmakers are working with piecemeal data, non-profits are scrambling for attention, and the push to increase state revenues becomes ever so taxing.

Many of the same lawmakers who were freely spending surpluses just a few years ago are now looking for ways to close a $3 billion budget gap that will take hold July 1 and not let go until June 31, 2012. One way to address the cliff is to pull back - on expenditures, that is - but that's hard to do when the breaks won't cooperate.

That's a challenge Rep. Joe Harrison, R-Napoleonville, has run up against as a member of the House Appropriations Committee, which was hearing testimony for weeks prior to the regular session's start in late March. While the state is obviously facing a situation where spending needs to be reduced, Harrison says the only kind of spending data he's seeing from state departments and agencies has arrived "bundled."

By that, he means that expenses are shown on paper as lump sums, mostly in categories, as opposed to a listing of every single expenditure. "We're not looking to micromanage here," Harrison says. "But we want to see if there's overspending."

In particular, Harrison says there may be gross overspending during the fourth quarter of every fiscal year. In many instances, agencies and departments can find themselves with 30 percent of their budget free for spending during the fourth quarter, he says.

Even in the corporate world, there's a prevailing philosophy that any money not spent in a current year budget will be subtracted from next year's budget since the extra cash, or surplus, was not needed. As a result, heavy fourth quarter spending normally ensues.

Harrison has been seeking information on this trend in state government, should it exist, for months and may be closer than ever to obtaining a definitive answer with his House Bill 387, which would force every state entity to submit itemized monthly spending reports to the division of administration.
Most folks in the budget line, however, are more concerned with actually getting state money. The Public Broadcasting Service member stations in southeast Louisiana that pipe Antiques Roadshow, Big Bird and coverage of the ongoing regular session into livings room are among those feeling the burn, albeit differently in each case.

For the second year in a row, WYES and WLAE have been excluded from the budget after 25 years of consecutive appropriations. In 2008, WYES received $360,000, and WLAE was channeled $280,000.
Meanwhile, the Louisiana Educational TV Authority, which oversees Louisiana Public Broadcasting in Baton Rouge, is facing a 20 percent or $1.7 million cut. LPB President Beth Courtney told members of the House Appropriations Committee recently that she needs an additional $900,000 in the budget, which LPB would match with $1 million in fundraising.

If that doesn't happen, she says employees will have to be furloughed and broadcasting shut down at least once a week. "It's a mountain that's going to be really high to climb," Courtney says.  
Randy Feldman, president and general manager of WYES-TV in New Orleans, says it's still a confusing policy choice for the committee. "We serve 13 parishes and one-third of the state's population," he says. "Why LPB is still in the budget but we're not, I don't know. It's a policy question for the leadership, an issue of consistency."

Feldman says he's working with regional lawmakers to seek out a solution and some relief before the 2011 budget negotiations begin, which is when he says serious cuts will have to be handed down at all of the PBS member stations, which cooperate and share resources on a regular basis. "For me, this is not a LPB-WYES-WLAE issue or a New Orleans-versus-the-rest-of-the-state issue. It is, simply put, that if a service is a priority of the state government, that service should be supported throughout the state."

While LPB has the backing of a state agency in the Louisiana Educational TV Authority, WYES and WLAE are treated as non-governmental organizations in the budget - a breed that's under attack this year. For example, Rep. John Schroder, R-Covington, has introduced House Bill 1101 to prevent NGOs from receiving state funding during deficit years, and lawmakers seem to be taking the usual uproar over earmarks and pork more seriously.

Photo by Robin May

Mona Gobert-Cravins, assistant administrator of
232-HELP/Louisiana 211

Mona Gobert-Cravins, assistant administrator of 232-HELP/Louisiana 211, an informational referral line serving Acadiana, has been working to muster nonprofit troops statewide to oppose Schroder's bill, and she's been appealing directly to lawmakers.

"The funding NGOs receive from state government and the actual services we provide should provide testament to why the cutting of NGOs at a time when the state needs us the most is not a risk the state should take," she writes in an e-mail to members of the Acadiana legislative delegation. "The extraordinary burden the state would place upon the nonprofits you look to to provide needed critical services during times of hardship is unfounded and actually increases the needs by citizens on state government programs (which are themselves becoming fewer to be had)."

Reductions, though, will only get lawmakers so far, especially this year. How will they balance a budget that's lopsided by $1 billion during a non-fiscal session (under Louisiana law, tax measures can only be addressed in sessions during odd numbered years)? Not to mention a no-new-tax administration? Where's the money going to come from?

Senate President Pro Tem Sharon Weston Broome, D-Baton Rouge, offers a reality-based, sobering outlook not only for this coming fiscal year, but also for next. In 2011, the Legislature will face an additional $2 billion shortfall and taxes will finally be on the table, but Gov. Bobby Jindal will likewise still oppose them. "In some instances, there will be no good choices," Broome says. "Vital services for our families, our children and our disabled and elderly citizens are at stake."

Her boss, Senate President Joel Chaisson, D-Destrehan, says everything deserves a hearing at this point. "Now more than ever we need to bring all ideas to the table for a reasoned, responsible discussion about Louisiana's new path," he says.

That new path is probably going to be paved with lots of fees, which are kind of like a tax from the government, but they're levied against consumers and users and are normally dedicated to specific state services (and they're called by a different name). That may end up being one way the budget is ultimately balanced, and dozens have been put into the pipeline.

Higher ed folks are looking to increase fees virtually across the board if they can, not to mention tuition, and even neighborhood protection districts statewide are asking for higher parcel fees. There's one bill that would boost vehicle inspection fees and another to jack up emission inspection fees.
There are also possible fee hikes being debated for practically every class of driver's license, brand new tires, certain civil filings, state park admissions, traffic cases, arrest expungements, consumer credit transactions, used motor vehicle dealers, oyster leases, copies of medical records, license plates and every fine that can be issued by the Louisiana Department of Wildlife and Fisheries - on a biannual basis.

You want to know how the budget will be balanced, at least in part, this year? Just slightly tweak the famous tax maxim often attributed to former U.S. Sen. Russell B. Long and you're there: Don't fee you. Don't fee me. Fee that guy behind the tree!

Jeremy Alford can be reached at [email protected]