"I'm proud that we came together this session to pass a balanced budget that protects higher education and healthcare without a tax increase," Louisiana Gov. Bobby Jindal said.

BRADENTON, Fla. — The Louisiana Legislature ended its regular session June 11, passing a $24.4 billion state budget to close a $1.6 billion budget gap.

The total 2016 spending plan, which is a 2.6% reduction from the current budget, includes fee and tax increases and tax credit program adjustments that Gov. Bobby Jindal has indicated he will support.

The general fund portion of the budget is $8.29 billion, a 0.1% reduction from the current year. If Jindal signs the budget, as he indicated he will do, it takes effect July 1.

Lawmakers also adopted a $5.26 billion capital plan that will be supported by $3.86 billion in state-issued general obligation bonds.

"I'm proud that we came together this session to pass a balanced budget that protects higher education and healthcare without a tax increase," Jindal said. "It's been a great session and I'm proud of the legislators' hard work."

In conjunction with the budget, legislators also approved a controversial higher education tax credit called SAVE, or Student Assessment for a Valuable Education. SAVE assesses a $1,500 fee per student to raise $350 million, though no student fees will increase and no tax credit will be provided.

Jindal demanded the measure to avoid a budget veto and to protect the governor's no-tax increase pledge as his embarks on a bid for the Republican presidential nomination. Jindal has already formed an exploratory committee and indicated that he will announce his candidacy soon.

Jindal had threatened to veto tax and fee increases supporting the budget if lawmakers did not pass SAVE.

The taxes include a 50-cent increase on each pack of cigarettes, and other tobacco-related products as well as e-cigarettes, and a $50 increase in vehicle title fees.

Other deficit-closing measures included ending or adjusting certain tax credit programs, temporarily suspending 1-cent sales tax exemption on business utilities, limiting tax breaks for oil and gas industries, a provision to collect state sales tax from online retailers, and limiting the tax credit Louisiana residents can take for income taxes paid to other states through June 2018.

A bill proposed by Jindal's administration to securitize the remaining 40% of the state's Master Settlement Agreement with tobacco companies never gained traction during the two-month session.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.