DALLAS — Louisiana Gov. Bobby Jindal on Thursday ordered state agencies and departments under his control to halt nonessential spending in light of a looming revenue shortfall in fiscal 2010.
Jindal said he ordered the spending moratorium because “underlying assumptions and needs in the development of the current year’s state budget will be drastically altered by the projected decline in the state’s revenues.”
The governor said he was “implementing fiscal management practices to ensure that appropriations will not exceed
actual revenues.”
The action came after the Louisiana Department of Revenue said state tax collections in February dropped to $157 million from the $197 million collected in February 2009.
Personal income tax collections last month totaled $209 million, but refunds amounted to $230 million.
Sales tax revenue in fiscal 2010 is expected at $2.26 billion, rising to $2.49 billion in fiscal 2011.
A revised estimate in December predicted personal income tax revenue of $2.6 billion in fiscal 2010 and $2.7 billion in fiscal 2011.
The Revenue Estimating Committee, which develops estimates used by budget writers, is expected to meet in mid-April to review the latest revenue reports and revise estimates for fiscal years 2010 and 2011.
The current revenue estimate for the remainder of fiscal 2010, which ends June 30, may be lowered by more than $250 million.
Commissioner of Administration Angèle Davis, the governor’s chief budget officer, said it was not clear how much money can be saved by the spending freeze, which extends until the end of fiscal 2010 on June 30.
Under the plan, no state agency or department can spend money on travel, operating services, supplies, professional services, or major repairs without written approval from Davis.
However, there are more than 20 exemptions to the freeze, including public safety, hurricane recovery and rebuilding efforts, tourism marketing, and equipment needed to maintain state vehicles.
The Legislature convenes today for a three-month session.
Members of the Legislature will be considering the Republican governor’s proposed $24.2 billion operating budget for fiscal 2011.
The spending figure is based on expected general fund revenue of $8 billion, which may be lowered by the estimating conference.
The revised forecast of $8 billion in fiscal 2011 general fund revenue formed the basis of the operating budget Jindal unveiled in mid-February of $24.2 billion, including federal funds and dedicated revenue, such as fuel taxes, that are not part of the general fund budget.
In 2009, the Legislature approved a $28.8 billion budget for fiscal 2010.
