The $247.9 million budget shortfall predicted for the coming year could easily be covered by proceeds from the state’s Tax Amnesty Program if Gov. Bobby Jindal were not so focused on further cuts to the state’s already-spare budget.
Although higher education and health care are slated to be cut by millions of dollars in the upcoming legislative session, the state has already collected more than $450 million through a tax amnesty program that allows people with outstanding tax obligations to pay their debts without penalties. Experts agree that much more will be collected before the amnesty program expires.
State economists explained on December 19 that the budget shortfall announced by the governor does not include revenue from the tax amnesty program. Of the total collected thus far by the program, LFT Legislative Director Alison Ocmand said, some $176 million is already earmarked for the state’s rainy day fund and coastal restoration. The State Department of Revenue also keeps some of the money for administrative costs. All the rest will go into the state’s general fund.
According to Ocmand, it is not yet clear just how much the amnesty program will pour into the general fund this year, or if enough will be collected to correct the deficit projected by the Jindal administration.
What is clear, Ocmand said, is that the governor has no intention of using the amnesty program proceeds to offset the reported deficit. The governor’s statement on the deficit says, in part, "The Governor also noted that the state would not use Tax Amnesty funds to address the midyear deficit, as that would not reduce the size of government to help address multiple years of budget challenges."
Instead of using the amnesty program money to fill the budget hole, the administration has decided to cut the budget, and the bulk of those cuts will fall on higher education and health care. Money left over will be declared as “non-recurring,” and can only be spent on a few types of appropriations, according to the state constitution
The conclusion is obvious. Instead of spending tax revenues on programs that benefit the people of Louisiana, the governor has chosen to follow an ideological agenda that will result in less money for higher education and health care.
To view the Governor's statement and executive order regarding the deficit, please click here.