By Victor Skinner, The Center Square contributor
Louisiana Commissioner of Administration Jay Dardenne presented a breakdown of the governor’s proposed budget Tuesday to the Joint Legislative Committee on the Budget, prompting an array of questions from lawmakers on a variety of issues.
Dardenne laid out how Gov. John Bel Edwards hopes to spend a flood of $2.83 billion in extra revenue for the upcoming fiscal year, money that includes $1.4 billion from the American Rescue Plan (ARP), $700 million in surplus from fiscal year 2021 and an $853 million excess for fiscal year 2022.
“We have about $3 billion in one-time money available to us,” he said. “We’ve always said we will not use nonrecurring dollars for recurring purposes.”
Spending from the ARP would devote $550 million for the Unemployment Insurance Trust Fund to ensure a $750 million balance necessary to avoid an automatic tax on employers. Another $275 million is earmarked for transportation projects, which include $100 million for the Lake Charles I-10 bridge, $100 million for I-49 South, $50 million for a DOTD Opportunity Fund for federal grant matches and $25 million for the Baton Rouge to New Orleans railroad.
About $193 million in ARP money would go toward 81 water projects, as well as $104 million toward 31 sewer projects.
The governor would devote $175 million in fiscal year 2021 surplus to the rainy day fund and $70 million to unfunded liabilities, as required by the constitution. Another $196 million would go toward federal matching funds for highway and infrastructure projects, $150 million toward the coastal master plan, and $109 million for capital outlay for deferred maintenance on state buildings.
“Every time we fail to meet a deferred maintenance obligation it … increases the cost down the line,” Dardenne said. “This would be money very well spent.”
The $847 million excess for fiscal year 2022 – what’s left after a $400 million federal repayment for repair of the New Orleans levee – would go toward $450 million in debts to the Federal Emergency Management Agency, $50 million for an early childhood fund for local grants, $42.5 million for Department of Transportation and Development federal matching funds and a $500 million deposit in a new fund for a bridge over the Mississippi River in Baton Rouge.
“This gives us the opportunity for the first time … to put real money to these mega projects,” Dardenne said, adding that the large sum for the Mississippi River bridge is intended to show the state is committed to the project.
Other supplemental spending for 2021-22 would include $1.5 million for the Northwest Louisiana crime lab, $3 million in death benefits for military families, $5 million to cover expenses for the NCAA final four, $6.9 million for internet work, $10 million for the Louisiana Outdoors Forever Fund to promote the state’s outdoor heritage, $16.7 million for corrections and public safety, $65 million toward a backlog of judgements and another $65 million for capital outlay projects, Dardenne said.
Several lawmakers raised questions with the $500 million set aside for the Mississippi River bridge, with Rep. Denise Marcelle, D-Baton Rouge, pointing out the money “couldn’t then be used for a different purpose.”
“We know this is a project that has got to happen sooner or later,” Dardenne said. “It’s just to show our commitment … with a separate fund.”
Senate President Patrick Page Cortez, R-Lafayette, questioned whether it was too early to set aside $500 million for the bridge, and whether the money would be better spent on debt.
“Is that the best use of the money, putting it in a fund for 10 years before we get it off the ground?” he questioned, noting that online sports wagering could eventually bring in additional revenue.
“I think the time is now to create a source of funding to move on,” Dardenne said.
Sen. Mack White, R-Baton Rouge, expressed skepticism lawmakers can find support to devote $500 million to the bridge now, pointing out the money represents about three-quarters of the excess for 2022.
“I don’t know how to hold $500 million for years and years,” he said. “I don’t know if we can get three-quarters of the excess into that.”
Some lawmakers stressed the need to distribute funding and projects equitably to rural areas of the state, while others sought specifics on the early childhood program and other spending. Several lawmakers also questioned whether the budget should include tax savings.
Rep. Blake Miguez, R-Erath, specifically took issue with $5 million going toward the NCAA Final Four to cover costs associated with a potential decline in attendance because of the pandemic, citing the city’s restrictive policies as a root cause.
“Why does the state of Louisiana need to spend their money for the decisions of local officials?” he questioned.
Dardenne countered by citing the statewide impact of the event.