A new Louisiana governor inherits a massive budget mess, a state struggling with years of red ink that his predecessor patched through rather than fixing. Now, government services are on the chopping block, threatened with hefty reductions.
Sound familiar?
That was the scene when Buddy Roemer took over as Louisiana’s governor in March 1988, The Associated Press reports. And it’s the same landscape 28 years later, as Gov. John Bel Edwards, in office since January, readies for a special legislative session he called to try to repair the state’s seemingly never-ending financial morass.
As Edwards and lawmakers try to solve the budget problems and stabilize state finances, long-termers at the Louisiana Capitol repeatedly reference 1988. It’s the last time they remember the budget woes being so acute.
“It’s a shame that here we are, years later, going through the same mess,” says Robert Adley, chairman of the House budget committee during Roemer’s tenure and now an official with the Edwards administration.
On Wednesday, the state’s income forecasting panel, downgraded tax revenue projections, with economists saying collections across nearly all tax types are far lower than projected earlier this year.
The Edwards administration is now grappling with an $850 million gap in this year’s $25 billion budget, which must be rebalanced by June 30. Next year’s shortfall is pegged at more than $2 billion. The Democratic governor is proposing tax hikes to fill holes.
Figures get hazy as decades pass, but those around three decades ago peg the deficit Roemer inherited in the range of $800 million to $1 billion—in a budget that totaled only about $7.5 billion.
To top it off, the state had so little money in the bank, it had trouble paying its bills.
Companies started requiring Louisiana to pay when supplies were delivered. The state defaulted on lease payments and agencies were forced out of office space. Paychecks to state workers were slowed.
“There were meetings going on quite frequently about what bills can be paid when,” says Legislative Fiscal Officer John Carpenter, who led the House’s financial staff at the time.
Today’s financial difficulties haven’t reached those cash-flow troubles, but Treasurer John Kennedy has warned such problems loom if the budget isn’t stabilized.
