As the new gubernatorial administration and newly elected state Legislature start to discuss ways to fix a state budget that is $750 million in debt this fiscal year, $1.2 billion in debt next fiscal year and in need of systemic structural reform, a handful of experts had some advice for them today.
“The answers are out there, but it is going to take a lot of consensus building,” said consultant and lobbyist Mark Drennen, who partook in a panel discussion today at the Louisiana Association of Business and Industry’s annual meeting. “It isn’t going to happen in the next few weeks, but it will have to happen.”
Drennan is particularly well suited to weigh in on the matter. He served as commissioner of administration from 1996 to 2004 under former Gov. Mike Foster. He joined two other former commissioners of administration, Dennis Stine and Angele Davis, on the panel. The panelists discussed the state’s fiscal challenges from a historical perspective.
Stine, who served under former Gov. Buddy Roemer as the state’s top budget officer from 1988 to 1992, recalled the draconian cuts and unusual revenue raising measures Roemer’s administration took to balance its first budget. Then, like now, the budget was nearly $1 billion in the hole. Back then, however, the state budget was much smaller so the shortfall was proportionally that much greater.
“It was a difficult time,” said Stine, who offered several suggestions for this year’s Legislature.
“I’d start with cuts and abolish every statutory dedication in the special session. I’d look at every level of responsibility of local government. I’d cut the judicial, legislative and executive budgets, something that hasn’t been done to the level it should be.”
Angele Davis, who served as commissioner of administration from 2008 to 2010 under former Gov. Bobby Jindal, also recommends closely scrutinizing dedicated funds as a way to potentially free up hundreds of millions of dollars.
“We should be stepping back and looking at every dedication,” Davis said. “Those dedications are going to the same programs year after year.”
Drennan said other possible solutions include revisiting the Stelly Plan. The controversial revenue-raising measure of the early 2000s increased income taxes that were supposed to be offset by sales tax exemptions. Several years later, the Legislature repealed the income tax increases but kept the exemptions, which is one of several factors behind the current budget shortfall.
“Revisiting Stelly is something we need to do,” Drennan said.
—Stephanie Riegel
