Gov. John Bel Edwards’ 2017-18 fiscal year executive budget is built on $9.469 billion in state general fund tax receipts, of which 92 percent ($8.750 billion) will be used to fund general government operations. The rest would finance the Legislature and judiciary, along with required spending on debt service and other obligations. The general fund budget is at a practical standstill compared to current-year spending levels after adjusting for inflation (a 0.32 percent decrease). The state’s overall budget would increase by 5 percent in real terms, primarily due to an increase in federal dollars that support healthcare services.
Although Louisiana is expecting a slight revenue uptick next year, state tax collections continue to lag far behind the levels seen before 2009, when the Great Recession and two major income-tax cuts helped destabilize the state tax structure. After adjusting for inflation, the state’s general fund – which finances K-12 schools, universities, healthcare and other services – is down 21 percent since the 2008 fiscal year. This reality, coupled with data showing state revenues well below their historic share of the state economy – by multiple measures (see Appendix) – should put to rest any notion that spending is “out of control.”