HEADLINES : Louisiana

Part of budget shortfall caused by one-time money

CBS Money WatchJanuary 24, 2012

BATON ROUGE, La. - The $895 million shortfall projected for the upcoming budget year shouldn't come as a total surprise to Louisiana lawmakers or Gov. Bobby Jindal's administration.

At least 40 percent of the gap is tied to the use of one-time money that propped up parts of the current budget and that is expected to fall away in the new fiscal year that begins July 1, most of it used in the state's Medicaid program.

Another slice of next year's shortfall is caused by tuition increases approved by lawmakers and sought by Jindal, that while helping plug some higher education holes, will also increase the cost of the state's free college tuition program.

When the governor's financial architects and lawmakers crafted this year's budget, they scraped dollars from state funds earmarked for other areas and tapped into one-time available sources of federal cash to balance the spending plans. Most agencies took cuts at the beginning of the fiscal year and then earlier this year when income estimates again fell short of projections.

Jindal's budget proposal for the 2012-13 fiscal year is due to lawmakers Feb. 9, and the administration told lawmakers the state is short $895 million next year in state dollars of what it could cost to continue all current services and account for inflationary costs.

That includes a projected $538 million gap in the Medicaid program that cares for the poor, elderly and disabled.

 

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