Gov. Bobby Jindal’s budget will preserve state general funding to higher education while making widespread cuts across the state bureaucracy, some of which will affect universities.
The executive budget, as expected, includes no new taxes. The governor has said throughout his tenure that he will veto any tax increase that crosses his desk.
Without increased tax revenue, the administration plans to fill the state’s $1.6 billion budget gap with reductions and other revenue increases.
Most of the deficit — more than $1.1 billion — comes from expenditure reductions. The budget includes about $410 million of actual funding cuts to agencies throughout the state budget.
Another $96 million would be saved by eliminating positions. That amounts to about 4,000 positions across state government, half of which are filled. Eight hundred of those positions are slated for higher education.
The budget also “annualizes” $110 million in cuts from this year. Some cuts assigned this year take time to be implemented — these funds are a result of the 2011 cuts taking full effect.
Though higher education did not suffer a fiscal year general fund cut this year, it did face a midyear cut — whatever reductions have not been made to account for that cut will be made in the coming year and will count toward savings in Jindal’s budget.
Jindal’s budget also counts $200 million in savings for unfunded mandated costs. These are costs that state programs must pay without receiving general fund money to do so.
University administrators have repeatedly complained that such costs have caused budgetary damage that “doesn’t show up on paper.” While not technically budget cuts, administrators argue, unfunded mandates absorb money that would otherwise go to pay for student services.
Jindal also plans to save $105 million by not paying out an annual increase to the state’s Minimum Foundation Program, which funds K-12 education.
The MFP is constitutionally protected from general fund budget cuts, but Jindal’s budget withholds the traditional 2.75 percent increase to the program that normally pays for things like increased student totals and inflation.
The final expenditure reduction is $225 million in “efficiencies” that the administration says it has found or will find within state government.
The budget also hinges on several proposed new revenue streams.
Jindal plans to make $86 million by privatizing two and selling three state prisons.
The administration also plans to transfer funds worth $241 million and to raise $25 million by forcing state employees to pay more of their health care and retirement.
Jindal’s budget must be approved by the Legislature, where some proposals might face serious challenges.
Several legislators, most of them Democrats, sharply criticized Jindal’s budget when it was officially unveiled Friday. They said it assumes passage of several of the governor’s proposed pieces of legislation, most notably an amendment to fund TOPS.
Jindal’s budget pulls general fund money from the scholarship program, making up the hole with a constitutional amendment he proposed last month that would move currently protected funds to better finance the program.
Constitutional amendments require a two-thirds vote of the Legislature and a vote of the people to pass.
The TOPS amendment and prison sales plan were among several proposals legislators criticized at Friday’s hearing.
Sen. Karen Carter Peterson, D-New Orleans, said she thought the budget was unconstitutional because it relies on the “contingency” of certain legislation passing.
For every legislative cog in Jindal’s hypothetical budget machine that fails, Peterson argued, policymakers will have to make up the money elsewhere.
Peterson and other legislators also took aim at the budget’s reliance on “efficiencies,” which they said might not be found, causing further future shortfalls.
Since higher education and health care are the two largest parts of the budget available to be cut, it’s possible those two programs will suffer midyear cuts if a shortfall does exist.
 
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Contact Matthew Albright at [email protected]