Gov. John Bel Edwards’ administration unveiled his $36 billion budget plan for the spending cycle that begins July 1. The spending likely won’t be finalized until June, after lawmakers and the governor negotiate over the proposal.
Currently, the governor is proposing to spend $186 million more in the next budget than he did in the current one. Most of the increase in spending would go to K-12 schools or higher education programs, said Jay Dardenne, commissioner of administration and Edwards’ budget chief.
Federal COVID-19 funding has helped the state avoid cuts to programs
Coping with a pandemic and seven named storms over the last year, there was a lot of fear that Louisiana’s budget was going to take a huge hit and result in large cuts to education programs and social services.
But officials have largely been able to plug Louisiana’s large budget hole with federal COVID-19 relief funding. Edwards doesn’t have any cuts in his budget proposal, the governor said Thursday.
Much of the help comes from the federal government’s decision to cover a larger share of the Medicaid budget during the pandemic. That means Louisiana can shift about hundreds of millions of dollars to needs other than the health program.
It’s possible Louisiana could receive even more federal COVID-19 funding before the budget is finalized in June, but there are lawmakers who are concerned that the governor has relied too much on one-time funding to cover ongoing expenses in his current proposal.
“To replace this one-time money is pretty substantial,” said Rep. Jerome Zeringue, R-Houma, head of the House Appropriations Committee which oversees the budget process.
Everyone is excited about the teacher pay raise — except maybe the teachers?
Edwards, a Democrat, has proposed a $400 increase in K-12 teacher pay and $200 increase in school staff pay starting July 1 — and at least some Republican leaders appear to be on board. The pay increase will cost around $40 million.
“I will be 100 percent in support of giving teachers a raise,” said Senate President Page Cortez, R-Lafayette. “If there’s any group that has had a tougher time during the pandemic, I’d like to hear it.”
The teachers agree they should be making more — but perhaps a lot more than $400? The Louisiana Federation of Teachers — one of the state’s two major teachers unions — wants to push for a larger pay increase. Teacher and school staff didn’t get raises at all last year, and they make, on average, less than teachers in other Southern states.
Higher education faculty could get a raise
The governor is also proposing a statewide higher education faculty pay raise for the first time in over a decade. It would cost $19.8 million.
“After an unprecedented year, I want to thank the governor for proposing a budget that calls for a reinvestment in higher education that would stabilize our budget, provide additional funding for our critical research institutions and hard-earned raises for our faculty members,”said interim LSU president Tom Galligan on Twitter.
Louisiana will probably put more money toward housing prisoners
That Edwards system said the prison population of Louisiana has decreased by about 13,000 inmates since 2012, though Louisiana still has the highest incarceration rate in the country. The drop in the prison population also hasn’t stopped the cost of housing prisoners from going up.
Edwards has proposed devoting $24 million for housing state prisoners in local jails with sheriffs next year. Some of this may be more like a reallocation of funding. The state often ends up paying sheriffs more at the end of the year to house prisoners because it hasn’t budgeted enough at the beginning of the year for the space it uses.
The governor is also proposing an increase of $35.6 million to cover salary increases and medical costs at prisons — but at least some of this money isn’t new and has been paid in previous years at a different point in the budget cycle.
There are consistently cost overruns in these prison programs that have to be covered at the end of the state’s budget cycle because the governor and legislators have resisted giving them the appropriate amount of money in the upfront plan. With this increase, the Edwards administration is essentially suggesting that the state be more honest about the cost of prison programs at the beginning of the budget process.
Republican Legislative leadership is pushing a simplified tax system.
The Republicans will be pushing an overhaul to Louisiana’s tax system during the lawmaking session that starts in April. Eight members of the Louisiana Legislature’s leadership — all Republicans — have outlined a proposal to simplify the tax structure.
They want to centralize sales tax collections, lower the income tax rate, eliminate the state deduction for federal income taxes, simplify the corporate franchise tax scheme and phase out the business property tax on inventory.
Several of these suggestions have already been made in recent years and failed to get enough support to pass.
Edwards, a Democrat, said he is open to considering the Republican plan as long as it doesn’t reduce tax revenue overall for the state.