Wednesday, May 20, 2015

Wednesday, May 20, 2015

Budget deal takes shape in House; Kennedy vs. Jindal on tobacco settlement; Mental health facility could save Baton Rouge $55 million and; House gives universities increased authority, but not over tuition, blocks proposal to cap TOPS

Budget deal takes shape in House
The final pieces of the House version of the state budget began coming together on Tuesday, when the House budget committee used newly recognized tax revenue to plug holes in the current-year budget for health care and education programs. The House Appropriations Committee also maneuvered to use $125 million in surplus dollars to fill some of the deficit in next year’s spending plan. The AP’s Melinda Deslatte was there:

 

For this year, $36 million would be added to the public school financing formula to cover a higher-than-projected number of students, $12 million would fill a Medicaid program gap and $3 million would go to sheriffs for housing state prisoners in local jails. The bill also would steer $21 million to the LSU hospital privatization deal in New Orleans, to chip away at a projected shortfall when hospital services shift from an interim facility to a new state-constructed hospital this summer. Committee members asked few questions and had little discussion as they advanced the budget-balancing bill, most of which was crafted by Gov. Bobby Jindal’s administration. Committee Chairman Jim Fannin described it as “just cleaning out and fixing the current year.”

 

Kennedy vs. Jindal on tobacco settlement

State Treasurer John Kennedy is refusing to put the sale of the state’s tobacco settlement on the Bond Commission agenda in an attempt to stop the state from losing hundreds of millions of dollars in future revenue.  There appears to be scant support from state officials for the sale, with Kennedy stating that the majority of legislators “would rather drink weed killer” than sell the remaining portion of the tobacco settlement.  Gov. Bobby Jindal supports the sale, which would raise short-term cash that could be used to plug budget holes. Once again, Melinda Deslatte is on the case:

 

The proposal involves Louisiana selling the tobacco settlement for an estimated $750 million, with $150 million earmarked for coastal projects and the rest paying for the TOPS free college tuition program through 2023.  That would help generate new money for next year’s budget, to help lessen cuts. But the state would trade $1.2 billion in annual settlement payments for the $750 million lump sum. Kennedy, chairman of the Bond Commission, calls the sale a “bonehead move” by the Jindal administration, a budget gimmick that would cost taxpayers hundreds of millions of dollars for a quick fix to state financial problems.  But he said he’d put the idea up for Bond Commission consideration if legislative leaders on the panel were clamoring for a sale. They aren’t, he said. “I’ve talked to a number of legislators,” Kennedy said Friday. “I don’t plan on wasting the Bond Commission’s time if the Legislature has no interest in it, and so far the Legislature has indicated no interest.”

 

Mental health facility could save Baton Rouge $55 million

A treatment center for the mentally ill would likely save Baton Rouge tens of millions of dollars over time if it offered mental health services instead of sending the mentally ill to the parish prison system.  Rebekah Allen reports for The Advocate:

 

East Baton Rouge Parish could save $3 million in its first year and $55 million over 10 years in government expenses if it were to open a treatment center diverting mentally ill people from the parish prison system, according to a financial report commissioned by the Baton Rouge Area Foundation. The report was prepared by economist M. Ray Perryman, founder of The Perryman Group in Waco, Texas, who calculated the direct and secondary economic benefits the proposed jail diversion program could have on the parish.

 

House gives universities increased authority, but not over tuition, blocks proposal to cap TOPS

The House approved a bill to give the state’s colleges and universities greater control over certain purchases and contracts, reports The Advocate.

 

The House voted 85-8 for the measure which would give schools autonomy over some areas now under state jurisdiction. House Bill 766, sponsored by Rep. Bryan Adams, would give schools more authority over travel arrangements, information technology purchases and some contracts.

 

But the House also rejected a measure that would give colleges and universities the freedom to set their own tuition rates, and restrained the growth of the TOPS college tuition program. Julia O’Donoghue for Nola.com reports:

 

The state House of Representatives killed a measure that would have limited Louisiana’s popular TOPS college scholarship program and made it easier to raise public university tuition. The legislation (HB 66) went down on a 45-57 vote Tuesday (May 19.) If it had passed, it still would have required the voters approval at the ballot box next fall.  Under the bill, the Legislature would have relinquished control over public university tuition and fees — handing over that authority to the higher education institutions’ management boards instead. The Taylor Opportunity Program for Students (TOPS) — which covers the college tuition bill for thousands of Louisiana residents each year — would also have been restricted if the legislation had become law.  The purpose of the bill was to help Louisiana’s college and universities cope with an array funding cuts from the last several years. But legislators who opposed the proposal said it was essentially punishing students for the state government’s failure to properly handle its financial woes.

 

Number of the Day

$37 Million – Current funding gap for the Minimum Foundation Program, the source of state funding for public schools. (Source: The Advocate).