Where’s the $600 million?

Where’s the $600 million?

There was heated back-and-forth last week in the Joint Legislative Committee on the Budget over a claim by Gov. John Bel Edwards he’s cut more than $600 million from the state budget since taking office.

Number of the Day

$20 million - The projected annual savings to the state from raising the age of juvenile jurisdiction to 17. (Source: LSU via Nola.com)

There was heated back-and-forth last week in the Joint Legislative Committee on the Budget over a claim by Gov. John Bel Edwards he’s cut more than $600 million from the state budget since taking office. Nola.com/The Times-Picayune’s Julia O’Donoghue fact-checked the figure and found that it was true.  But some of cuts weren’t permanent, such as the reduction to TOPS that resulted in partial awards being issued in the 2016-17 school year. Others were counted for each year they were missing from the budget. So how is it that the overall state budget has grown since Edwards took office? O’Donoghue writes:

There’s been a large influx of federal dollars into Louisiana because Edwards implemented Medicaid expansion in the middle of 2016. The federal government covers 95 percent of the cost of Medicaid expansion. With 440,000 Louisiana residents participating in the program, federal funding to Louisiana has surged to cover their health care costs. The state actually isn’t paying for Medicaid at all, because a special tax on Medicaid providers covers the state’s 5 percent share. The federal Medicaid expansion money also may be in the state budget, but it can’t be used for other purposes. That’s why you can still have a shortfall in some areas of the state budget, while funding appears to be increasing significantly overall.

 

Fiscal cliff gets in the way of recent policy priorities

Juvenile justice advocates are concerned that the fiscal cliff will get in the way of their efforts to ensure the safety of juvenile offenders. The governor’s doomsday budget included deep cuts to the Office of Juvenile Justice, which is charged with implementing a landmark law that moves 17-year-old offenders into the juvenile system from adult prisons. The legislation’s author, state Sena. J.P. Morrell, issued a call to action in an op-ed for Nola.com:

It’s time for all of us to stand together and demand that the Legislature stops giving lip service to its stated priorities. Whether it’s Raise the Age, TOPS scholarships or early childhood education, we cannot continue to pass legislation to improve the lives of our families, and then choose not to fund the initiatives we’ve created. . .We can’t afford to give up on our kids. They depend on us, and we can’t let them down. I encourage all legislators to come together and address the urgency of this dire situation. Let’s work together, with Gov. Edwards, for a lasting solution to our budget woes. It’s time to hold the Legislature accountable for the promises we have made.

 

Federal debt growing faster

The Congressional Budget Office is sounding the debt ceiling alarm earlier than expected thanks to the new federal tax law. Without action by Congress to raise the government’s borrowing limit, the federal government will be forced to shut down some time next month. Lawmakers have plenty of opportunity to take action on the debt ceiling while they negotiate to avoid a government shutdown on Feb. 8, but the faster than expected debt accrual should be concerning as we enter the first year of tax cuts under the new law. Erica Werner and Damian Paletta of The Washington Post explain:

The Treasury Department had $272 billion in cash on hand as of Tuesday, a substantial amount. But that money can disappear quickly based on the government’s spending patterns. For example, the government typically spends $50 billion in just the first few days of each month on Social Security benefits and military pensions alone. CBO, a budget watchdog arm of Congress, had previously estimated that the government would be able to fund operations until late March or early April, but it said its new projections on the impact of the tax law forced it to make adjustments.

 

Limited opportunities for disconnected youth

While the country is seeing job and wage growth, millions of young adults ages 18-24 are not employed or in school and aren’t reaping the benefits of the economic upturn. Martha Ross and Nicole Bateman of Brookings Institute report that a significant portion of these young adults are in areas of the country that have stagnant job markets and youth who haven’t been connected to post-secondary education or training are unable to take advantage of available jobs either way. Greater investment in community colleges and shorter certificate programs, as well as a greater emphasis on workforce preparedness in high school, could increase opportunity for disconnected youth and help them increase their chances for higher paying jobs:

If choices after high school are low-wage work or a post-secondary landscape that is confusing, difficult to navigate, and financially out-of-reach, we are setting young people up for failure. There is much we can do to ease the transition from high school to post-secondary education and ultimately into the labor market:

 

  • Offer much stronger advising to high school students about educational and career options;
  • Provide high school students with an opportunity to get a head start on earning college credits through dual enrollment programs;
  • Redesign high schools so they better prepare students for both post-secondary education and careers;
  • Create stronger pathways into the labor market through such initiatives as work-based learning in high school, sector strategies tailored to young adults, and apprenticeships; and
  • Make reforms within community colleges to increase graduation rates.

 

 

Number of the Day

$20 millionThe projected annual savings to the state from raising the age of juvenile jurisdiction to 17. (Source: LSU via Nola.com)