Louisiana House Appropriations Committee Chairman Jim Fannin believes the state will face more than a $700 million budget deficit next year despite passing more than $600 million in new annual tax revenue, The News-Star reports.
The state’s Revenue Estimating Conference will meet in the Capitol this morning to provide official projections for the next five years.
“My understanding and expectation is that the projection will mean we will face a budget hole of about $717 million for the 2016-2017 fiscal year,” says Fannin, R-Jonesboro, who will have a seat on the committee. “That’s a big number, but it’s not the $1.6 billion we faced this year.”
Fannin says the “real number” will likely be closer to $600 once inflation increases are backed out of next year’s budget.
“Without some help from oil prices or an increase in personal income and sales taxes then we will still have a major issue to deal with next year,” he says.
Fannin, who is term limited in the House, won’t face the deficit as Appropriations Chairman, but he is running for a seat in the Senate.
“So next year we’ll still have to make cuts or raise revenue or the best-case scenario is that our economy will improve and (sales tax and income tax) collections will rise,” Fannin says. “The (tax) measures we passed this year might also generate more revenue, but the Revenue Estimating Conference has to base projections on the fiscal notes assigned to the bills.”
State Sen. Neil Riser, R-Columbia, chairman of the Senate Revenue and Fiscal Affairs Committee, says the projection for a $700 million plus deficit “shows there is a real need for a complete overhaul of the tax code to stabilize the budget.”
