As they scraped together dollars to fill gaps in last year’s budget, Louisiana lawmakers relied on nearly $36 million from a state escrow account tied to ongoing tax litigation, dollars that can’t be spent while the lawsuits remain unresolved.
Much of the money earmarked for spending in the fiscal year that ended June 30 remains inaccessible, leaving last year’s budget out of balance. A $7.8 million transfer was made Tuesday evening after settlement of some litigation and following questions from The Associated Press about accessibility to the money.
Debt obligations not resolved by the mid-August close of books shift to the current budget year.
The Senate chairman whose committee added the dollars into the budget and Gov. John Bel Edwards’ administration said they’re convinced the cash will be available.
“We felt comfortable that the money would materialize,” said Finance Chairman Eric LaFleur, a Ville Platte Democrat.
The maneuver is reminiscent of the piecemeal financing used during former Gov. Bobby Jindal’s tenure, budgeting tactics that drew widespread criticism for creating uncertainty.
Edwards spokesman Richard Carbo defended the use of the escrow dollars and suggested the governor’s approach to budgeting was different from Jindal, with plans that “are honest and free of gimmicks.” Carbo said the administration is confident “funds used to cover supplemental expenses will be made available to the state over the course of the fiscal year.”
