It includes: college tuition increases, higher retirement contributions by state workers, the elimination of nearly 10,000 state jobs and a new tax on hospitals
College tuition increases, higher retirement contributions by state workers, the elimination of nearly 10,000 state jobs and a new tax on hospitals are among more than two dozen recommendations for plugging Louisiana's $1.6 billion budget shortfall outlined Monday by a group of business leaders.
The state budget is facing a third consecutive year of shortfalls. Other proposals from Blueprint Louisiana include reducing the state's prison population through revised sentencing guidelines, downsizing the state hospital system and freeing up spending for health care and higher education needs by unlocking money socked away in protected state funds.
Taken together, Blueprint estimates its 14 proposals would generate savings of between $972 million and $1.64 billion in the 2011-12 budget cycle. The recommendations are the latest ideas for rebalancing a state budget that is facing a third consecutive year of shortfalls.
Gov. Bobby Jindal is due to present his own recommendations to the Legislature on March 11.
"We believe that difficult budget cycles are also a good opportunity to implement long-term reforms," Bill Fenstermaker, Blueprint's chairman, told the Baton Rouge Press Club.
None of the proposals are new -- and some of them mirror efforts that are already under way, such as a plan to better coordinate care for Medicaid recipients and to maximize federal matching funds for health care costs.
Other ideas appear to be politically untenable, such as the call for a hospital provider tax that Blueprint estimates would generate up to $245 million next year. The plan is built on a similar idea that passed the Legislature in 2005, only to be repealed after Hurricane Katrina.
While hospital groups support provider taxes as a way of generating more federal Medicaid money, Jindal has ruled out tax increases as a tool for balancing the budget and any such plan is unlikely to win the two-thirds support needed in the Legislature.
"If the governor and the Legislature (are) not going to get behind it, it's kind of like, 'what's the point?' " Louisiana Hospital Association President John Matessino said.
Notably absent from the plan is any mention of reducing the special tax breaks and exemptions enjoyed by businesses, which are expected to be a major battleground during the budget debate.
The Blueprint recommendations include:
- Reducing the state's work force by 9,486 during the next two years, which would yield up to $235 million in savings next year.
- Increasing the employee contributions to state retirement plans for new workers and those who are not yet vested, with a potential savings of $25 million.
- Eliminating the Legislature's control over college tuition, giving colleges the right to set tuition levels at "market rates." Current law allows schools to raise tuition by up to 10 percent a year if they meet certain conditions, but anything more requires a two-thirds vote by lawmakers.
Founded in 2006, Blueprint describes itself as a citizen-driven group that advocates for public policy reforms. Its board consists mainly of business leaders.
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Jan Moller can be reached at jmoller@timespicayune.com or 225.342.5207.