Louisiana Gov. Bobby Jindal issued an executive order Dec. 16 to reduce general fund spending by $251 million through fiscal 2012.
Jindal used his constitutional authority to lower spending authorized in the $25 billion budget one day after the official Revenue Estimating Conference lowered its estimate for fiscal 2012 collections by $197.8 million.
The state constitution empowers the governor to cut budget appropriations by up to 5% if revenues do not match expenditures in a current fiscal year.
The budget rebalancing also accounts for a $42.7 million shortfall in the public education funding formula. Jindal said the spending cuts will balance the budget without harming higher education or health care.
“Like families and businesses across the state, we must live within our means and raising taxes would only push the burden on to our people,” the Republican governor said.
Jindal’s plan includes a reallocation of $24 million from the Department of Transportation and Development’s transportation trust fund to the general fund.
Transportation Secretary Sherri H. LeBas said the move will not affect current construction projects because the money will not come from the operating budget.
The cuts were necessary after the revenue panel accepted the projections of the Legislative Fiscal Office that revenue in fiscal 2012 would be $8.07 billion, down from an earlier estimate of $8.26 billion. The LFO also reduced its estimate for fiscal 2013 general fund revenues to $8.4 billion from an earlier estimate of $8.6 billion.
Greg Albrecht, the chief economist, said the state’s economy is in a “very sluggish, long climb.”
“Year over year we are seeing revenue growth,” Albrecht said. “We are in recovery. It’s not the recovery we would have thought a year ago or six months ago even, but it is recovery.”
Fiscal 2011 general fund collections totaled $7.8 billion.
