DALLAS — Louisiana Gov. Bobby Jindal will eliminate a $106.8 million deficit in the $25.5 billion budget for fiscal 2011 mostly by cutting expenditures for higher education and health care.
Jindal issued an executive order Friday calling for $34.7 million of cuts by state colleges and universities, $20.8 million by the Department of Health and Hospitals, and $11.7 million by Children and Family Services.
Other reductions include $6 million from the executive department’s budget for fiscal 2011, $5 million from the Department of Corrections, and $1.9 million from the Department of Economic Development.
Jindal also trimmed $6.3 million from public education, most of which officials said could be made up from federal sources. The spending cuts do not affect $3.3 billion in basic state aid to education in fiscal 2011.
During a news conference at the state capitol announcing the cuts, Jindal said Louisiana was spending more than it can afford. He said college administrators and state agency heads must deliver more value without spending more money.
“If they can’t do this, they need to step aside,” he said. “We don’t have time in Louisiana for whining.”
Jindal specifically challenged state-supported higher education to do a better job. He said Louisiana is ninth in the nation in state dollars spent on higher education as a percentage of state taxes yet the six-year graduation rate at public colleges is 38% and the regional average is 58%.
“Budget cuts may result in fewer sabbaticals and may force professors to actually spend more time in the classrooms teaching and interacting with students,” Jindal said. “That is a good thing and will result in a better education.”
The Republican governor’s budget-cutting order followed official recognition of the revenue shortfall by the Joint Legislative Committee on the Budget at the end of fiscal 2010. Jindal has 30 days to cut spending by 3% of the budget after such recognition.
Additional cuts require legislative approval, but the reductions announced by Jindal should be sufficient to make up for the current shortfall.
Commissioner of administration Paul Rainwater said the budget cuts will help address a fiscal 2012 revenue shortfall between $1.6 billion and $2 billion.
“We hope our revenues will increase this year, but we can’t count on hope to get us through,” he said. “We’ve got to start positioning ourselves for 2012.”
Rainwater said the current cuts involve recurring expenditures, rather than one-time spending that does nothing to help shrink the budget next year.
“When we asked the agencies for proposed cuts, we said no furloughs, no gimmicks,” he said.
Ray Stockstill of the Office of Planning and Budget said the shortfall, which must be made up by the end of fiscal 2011, occurred because fiscal 2010 revenues were less than predicted by the Revenue Estimating Conference.
Stockstill told the lawmakers that corporate income taxes generated $131 million less than expected last fiscal year, while sales tax revenue brought in at least $27 million more than predicted.
“Corporate taxes fell off the table at the end of the year,” said Greg Albrecht, chief economist for the Legislative Finance Office.
