The state’s ongoing budget crisis will come to a head this semester as state leaders attempt to fill a projected $1.6 billion budget deficit for the coming year.
That number was confirmed Thursday when the state’s Revenue Estimating Conference, the body that estimates how much cash the state will have to spend, declined to alter the revenue adjustments.
In previous months, lawmakers have referred to this year as the “cliff year,” when expiring federal funds will mean deeper cuts to departments that have already been trimmed by cuts during the past few years.
That cliff year means potentially drastic cuts to higher education.
State higher education officials released a plan last semester at the request of Gov. Bobby Jindal’s Division of Administration to deal with a potential 32-percent cut in state funding. That plan, released by LSU System President John Lombardi early last month, would result in students paying significantly more in tuition and fees.
However, policymakers hinted last week that the cut may be much less than 32 percent.
  Timeline: Budget Cuts 2010
 
Last week, Lombardi called off a meeting of the Board of Supervisors scheduled for Jan. 21. University heads were to release a plan to cut 10 percent at that meeting, but it has now been suggested the lower 10-percent target may be more severe than what the Executive Budget will require.
Jindal said last week he was “hopeful” cuts to higher education would be less than 10 percent, according to news reports.
University administrators emphatically caution that the decreased cut is by no means certain.
The smaller cut would hinge on the Jindal administration’s plans to find additional funds by a variety of means, including selling prisons, privatizing state employee health plans and getting some amount of lottery proceeds up front.
The Legislature has challenged using “one-time money” like this before in previous sessions.
The Governor’s Office starts the budget process when it releases its final budget March 11. That budget then goes to the Legislature, which will make changes to it.
The budget first passes through the more conservative House of Representatives, which usually cuts the budget, then through the Senate, which usually adds more programs.
The final form, approved by both houses, becomes law.
The Legislature will convene twice this year — first in an “extraordinary session” to be held from March 20 to April 13, then again in the regular session, held from April 25 to June 23.
In addition to the budget process, the Legislature must redistrict its congressional seats. Louisiana will lose a seat based on population data from the 2010 census; legislators will battle to control where the new district lines are drawn — a battle with significant political repercussions.
This session also comes in an election year, which many observers — including Chancellor Michael Martin — say will influence what bills are passed.
“[Legislators] have to pass a budget, they have to deal with redistricting, and it’s an election year,” Martin observed. “If they can just do all that, I think they’ll call the session a success.”
Still, filling the budget hole will likely be issue No. 1 for legislators. Several proposals for how to do so have been debated for months already.
First, some policymakers have said tax increases should be considered as a way to raise revenue. Sen. Ben Nevers, D-Bogalusa, and chairman of the Senate Education Committee, said last semester the Legislature should consider undoing its controversial repeal of the Stelly Tax Plan, which he says could net the state $300 million.
That solution, however, has been dismissed by many legislators and other influential policymakers. Jindal has vehemently vowed to veto any tax increases that reach his desk.
Legislators have also often talked about reducing the number of four-year universities in the state by consolidating or eliminating campuses. No specific campus has been mentioned for the chopping block yet, with legislators calling for the Board of Regents to make a consolidation plan they can pass.
Another solution on the table is removing constitutional and statutory dedications on protected programs throughout the state.
Currently, higher education and health care are the only major programs that aren’t in some way protected from budget cuts. So when cuts happen, these two programs suffer disproportionately high cuts.
Some policymakers want to remove those protections so higher education and health care don’t take more than “their fair share” of cuts.
Timmy Teepell, Jindal’s chief of staff, said last month that the administration supported bills in the past two legislative sessions that would have done just that, although those bills failed.
Teepell said the administration would support such bills again this year, although it was “too early to tell” whether they might be successful this time around.
Most policymakers are looking to fill the budget by eliminating waste and inefficiencies in government. State Treasurer John Kennedy, for example, made headlines last semester with his 16-point plan to fix the deficit.
That plan would reduce the number of state employees, revamp the state’s Medicare and Medicaid systems and find other savings throughout the budget.
The plan stoked a public feud with Jindal’s administration, which said the plan was unrealistic.
 
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Contact Matthew Albright at [email protected]