Senate approves state budget as special session deadline approaches

By David Jacobs | The Center Square

The Louisiana Senate approved next year’s state budget Friday, moving lawmakers one step closer to completing the constitutionally required work they didn’t finish during their pandemic-shortened regular session.

Senators unanimously approved the budget and sent it back to the House of Representatives, where members will review the Senate’s changes.

The state constitution requires passage of a balanced budget by the time the next fiscal year begins Wednesday. This month’s special session must end by 6 p.m. Tuesday.

The state operating budget totals more than $35 billion, billions more than last year’s budget. However, lawmakers say the increase on paper is misleading because billions in federal funds associated with COVID-19 relief are counted twice; House Appropriations Chairman Jerome Zeringue has called it essentially a “standstill” budget.

One of the few major points of contention Friday was the committee decision to hold off on spending about $58 million on scheduled “market rate adjustment” raises for state workers and trimming $24 million from various departments across state government.

Sen. Karen Carter Peterson, a New Orleans Democrat, said she is certain the federal government will send more pandemic relief to states, making the reductions unnecessary. State government should follow through on its promises to its workers, she argued.

Peterson also said the cuts, including $15 million from the Louisiana Department of Health and $3 million from Louisiana Economic Development, were unwise when the state is facing health and economic crises.

But Sen. Cameron Henry, a Metairie Republican, argued that given the current economic uncertainty, it makes more sense to hold back the money at least until the fall. Legislators likely will be in session again and might have a better idea of the state’s fiscal outlook. Giving departments more money later if the state can afford it is easier than making cuts during the fiscal year if necessary, Henry said.

Senators on Friday and during the Finance Committee’s budget hearing said giving raises would send the wrong message when so many people are out of work.

“What would be the perception?” Finance Chairman Sen. Bodi White said.

Much of the Finance Committee discussion involved the health department’s “money follows the patient” plan to change how it spends Medicaid dollars. Legislators said they hadn’t had enough time to review the plan and White said he feared it could lead to some hospitals going bankrupt and being “gobbled up” by a larger entity.

White said Friday that he had discussed the plan with outside consultants and was comfortable enough to let it move forward for one year and see how it works out.

“We never really got comfortable with it,” he said of the Finance Committee. “But we’re willing to try it for a year.”