Louisiana Treasurer Accuses Jindal of Scare Tactics

DALLAS — Louisiana Treasurer John N. Kennedy criticized Gov. Bobby Jindal Tuesday for using scare tactics in a dispute over the House’s refusal to appropriate non-recurring revenues in the fiscal 2013 budget.

 “Respectfully, please stop scaring our health care and higher education communities over the changes made to HB 1 by a majority vote of the Louisiana House of Representatives,” Kennedy said in a letter to the governor.

Commissioner of Administration Paul Rainwater, Jindal’s chief budget aide, told the Senate Finance Committee on Monday that the revised budget adopted by the House last week would require steep cuts to higher education, prisons and health services in fiscal 2013.

Kennedy outlined a list of potential savings that he said could be realized to avoid spending the $267.7 million of non-recurring revenues to balance the $25.5 billion budget that Jindal has proposed.

“It is not necessary to make the draconian reductions to the health care and higher education budgets you and your staff have suggested in order to achieve the fiscally responsible goals of the House,” the treasurer said.

In his letter to Jindal, Kennedy listed 10 ways to cut spending or increase revenue by a total of $400 million.

“We can reduce state spending, balance the budget responsibly and address our long-term fiscal problems without hurting or needlessly frightening the citizens in our health care delivery system or our colleges and universities,” he said.

Kennedy asked Jindal to appoint a panel of public officials and business leaders to study Louisiana’s tax laws and dedicated funds for six months. “After this transparent and public review, call a special session of the Legislature to make the necessary changes in these dedications and the state’s tax code,” Kennedy said.

Rainwater responded with a letter questioning Kennedy’s figures and suggesting that he focus on running the Treasury, not the state. “The numbers that you continue to use to support your case are not based in reality and the ideas you continue to advocate for will not work,” Rainwater said. “It’s concerning that a state treasurer would continue to use numbers he knows don’t add up and simply pretend that nearly $300 million more can be removed from the budget without dramatically impacting higher education and health care.”

The ideas contained in Kennedy’s letters are not new, he said, and would not reduce state spending. Kennedy should work on “reducing the explosive growth of personnel and expenses” in the Treasury, he said, adding that its budget has grown by 41% since Kennedy was first elected in 1999.

Savings proposed by Kennedy included $75 million from not filling vacant positions, $100 million from eliminating unnecessary consulting contracts and reducing the value of others by 5%, and $50 million from allowing the state to purchase private insurance for some of those now in the Medicaid program.

For reprint and licensing requests for this article, click here.
Louisiana
MORE FROM BOND BUYER