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Oct 22, 2010 4:35 PM by Letitia Walker

Jindal orders $107M in cuts to rebalance budget

BATON ROUGE, La. (AP) - Gov. Bobby Jindal said higher education, health care and social services will take the largest cuts Friday when he orders reductions to rebalance the budget and close a $107 million deficit.
The executive order, expected later Friday, comes after the
Joint Legislative Committee on the Budget accepted the latest
budget figures accounting for the deficit.
Higher education will take one-third of the cuts, about $35
million, with the bulk hitting the LSU System. The state Department
of Health and Hospitals must cut $21 million to help eliminate the
deficit - and another $50 million to account for a separate
shortfall in the state Medicaid program. A $12 million cut will hit
the social services department.
Jindal said he expects college administrators and state agency
chiefs to "do more with less," and he charged them to show "real
leadership" in continuing services while facing shrinking budgets.
He particularly singled out public colleges, suggesting they need
to reduce their administrative costs and provide students with a
better educational value.
"We need to deliver more services even while spending fewer
dollars. We don't need whining, we don't need complaining. We need
leaders to provide vision," Jindal said at a news conference,
outlining the cuts.
Most agencies have yet to explain what they'll cut, but public
colleges have said they'll lay off more than 100 employees, shrink
student scholarship offers and trim travel and supplies.
The LSU System said it will cut spending on its animal disease
lab, shut down the top two floors of a new research building at its
Pennington Biomedical Research Center and lay off 54 employees at
its agricultural research center.
The deficit is from the budget year that ended in June, the
first time in nearly a decade the state ended a fiscal year in the
red. Officials blamed lower-than-projected corporate tax revenue.
The state isn't allowed to deficit-spend, so Jindal must
rebalance this year's $25.5 billion budget to account for the
problem of the last budget year. For a midyear deficit, the
governor is able to cut up to 3 percent of total funding for each
"budget unit" without legislative approval.
Jindal announced the planned cuts only two hours after his top
budget adviser, Commissioner of Administration Paul Rainwater, told
lawmakers that he couldn't detail the reductions to them and didn't
have a complete plan devised.
Rainwater's response prompted complaints during the budget
hearing that the governor's office had been working on the cuts but
wouldn't provide the committee with any details.
"Don't blindside us. This has been the repeated approach of
this administration, to give us generalities," said Rep. Karen
Carter Peterson, D-New Orleans.
After news of the governor's announcement trickled down to the
budget hearing, Peterson asked for "a public apology for blatantly
being lied to" by the administration.
The deficit - which comes even after three rounds of cuts and
adjustments last year - is the latest in a series of budget
troubles for the state, which is bracing for a $1.6 billion
shortfall for the fiscal year starting July 1, preparing for a
lawsuit that could add a $200 million shortfall this or next fiscal
year and still coping with a series of budget cuts in the last two
"This is just the beginning," Rainwater warned.
The state's Medicaid program also has a separate current-year
shortfall because more people are using the health services than
expected. Jindal said his executive order will require cuts in that
program to address that shortfall.


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