Thursday, July 25, 2024

Officials say Louisiana will have a $143.3M budget surplus next year

by BIZ Magazine

By Victor Skinner | The Center Square contributor

Louisiana is projected to have a $143.3 million surplus in the 2024-25 fiscal year, then shortfalls of more than $400 million the next two, based on a fiscal snapshot presented to lawmakers Friday.

Ternisa Hutchinson, state director of planning and budget, offered an update on the state’s financials for August to the legislature’s Joint Legislative Committee on the Budget Friday morning, along with a five-year baseline budget summary.

The figures were based on revenue projections from a Revenue Estimating Conference in May that have not yet been updated to reflect tax changes approved by lawmakers this year.

Hutchinson said the General Fund Balance of $27.06 million includes appropriations from the recent session.

On June 30, the General Fund balance stood at $6.6 million and it’s projected to grow to $27 million for the current fiscal year that began on July 1, she said.

“The projected out years for 24-25 is $143.3 million positive, and then in 25-26 and 26-27 there is a negative imbalance of $473 million and $463 million in 27, and that’s primarily due to the roll off of the .45 cent” temporary sales tax that’s set to expire, Hutchinson said.

“There are no really big drivers in the out years, it is taking care of the increases needed for the Medicaid payments and it also accounts for the teacher pay raise that the legislature urged and requested (the Board of Elementary and Secondary Education) to include in the next resolution,” she said.

Lawmakers provided raises for educators this year that were not included as a recurring expense, but the projections on Friday include them as such since lawmakers signaled an intent to roll them in next session.

Rep. Blake Miguez, R-New Iberia, noted that the figures do not reflect tax credits or other impacts to revenue lawmakers approved during the 2023 session, which will be incorporated following the next Revenue Estimating Conference.

“These numbers are not final yet, there’s a lot more that needs to be done at REC to get an accurate forecast,” he said, drawing agreement from Hutchinson.

Sen. Sharon Hewitt, R-Slidell, also clarified that the additional payments into the state’s unfunded accrued pension liabilities were not yet factored in, though Hutchinson said they’re not expected to significantly change projections because the debts were not paid off.

“But it will be cheaper to pay off and hopefully we can get ourselves in that position … so that’s something to consider next term,” said Chairman Rep. Jerome Zeringue, R-Houma.

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