House cuts decried as Senate committee looks at $25 billion budget

Jindal administration seeks to restore spending

Museum and prison closures. Reduced services for mentally ill and developmentally disabled people. Job losses and less investment in business.

Paul Rainwater

Round two of the state budget process got underway Monday in Baton Rouge as a Senate committee heard from Jindal administration representatives, statewide elected officials and policy advocates about the effects of budget cuts made last week by the House.

Commissioner of Administration Paul Rainwater asked the Finance Committee to reverse a series of cuts to Gov. Bobby Jindal's $25 billion spending plan and get the budget bill back to the posture it was when the governor sent it to the Legislature in March.

"My request to this committee is to not lose sight of the bigger picture and long-term progress of this state," Rainwater said.

The House budget plan includes more than $200 million in new spending cuts and eliminates money from two sources on which Jindal had counted: the sale of state prisons and a higher payroll tax on state workers. Among other things, the House plan would cut $121 million from the Department of Health and Hospitals, which translates to more than $300 million once federal matching money is included.

House budget writers also took $82 million from an economic development incentive fund. That prompted warnings that Louisiana could lose out on large-scale industrial projects, including a possible new tenant for the Avondale shipyard.

Administration officials have been waging a public-relations offensive since the cuts were proposed, issuing a barrage of news releases and enlisting advocacy groups to "educate" lawmakers about their effects.

People with disabilities and their caregivers packed the Finance Committee hearing room to capacity, warning that people now getting state-financed home-care services could be forced back into institutions.

Kay Marcel, a long-time advocate for disabled people, said the $5.6 million in new cuts to the Office for Citizens with Developmental Disabilities threatens financial assistance that helps families cover the cost of raising disabled children. The latest cuts come on top of earlier reductions in the number of hours per week of home-care services that people may receive as an alternative to nursing homes.

"We saw the cuts the administration proposed as mostly strategic," Marcel said. "The House cuts are draconian."

Peggy Kirby, president of the Louisiana Foster and Adoptive Parents Association, said proposed cuts to foster families could expose the state to litigation.

The lobbying efforts appeared to find a sympathetic ear among senators, who historically have been more concerned about maintaining services than cutting spending. "These cuts impact the least of us," said Sen. Sharon Weston Broome, D-Baton Rouge. "And certainly we are sensitive to that."

Sharon Weston Broome

House leaders say the cuts are necessary because Jindal sent them an unbalanced budget. The governor's plan included more than $200 million in "contingency" spending that requires separate legislation, including the prison sales and a proposed constitutional amendment to finance TOPS college scholarships.

But Rainwater said contingency spending is nothing new, as the House approved a budget with contingency items as recently as 2009.

The House cuts came on top of more than $600 million in cuts and "efficiencies" proposed by the governor to patch a $1.6 billion shortfall in the 2011-12 budget year. Although state revenue is on the rise, Louisiana faces a budget shortfall due in part to the loss of federal stimulus money and a higher state cost-share in the Medicaid program.

Sen. Lydia Jackson, D-Shreveport, asked why administration officials described the latest cuts as having a devastating effect on state services while giving little information about the effect of the governor's proposed reductions.

"I think the public has been anesthetized to this budget and the devastating cuts to services that have not been identified by this administration," Jackson said.

Rainwater said the administration's budget cuts were carefully vetted with state agency heads to make sure they would not affect services. He said the House failed to do the same.

"I think the biggest difference is we worked with agencies for almost a year" to develop the budget, Rainwater said.

Much of the attention has focused on $81 million in Medicaid program cuts that were approved on the House floor. House leaders said the reduction would merely delay a new program to steer some Medicaid recipients into private managed-care plans.

Bruce Greenstein

But administration officials said they would have to cuts payments to health-care providers by as much as 8.2 percent. Health and Hospitals Secretary Bruce Greenstein that would mean fewer doctors accepting Medicaid patients, which in turn would send more people to seek care in the charity hospital system.

The budget came from the House without "member amendments," or legislative earmarks. But the bill includes millions of dollars in state subsidies for sporting events, festivals and other events, money paid in previous years with earmarks. For example, the budget bill includes $2 million for the NCAA Men's Final Four, $1 million for the Essence Festival and $500,000 for the Bassmasters fishing tournament, paid from a tourism fund that's financed by a dedicated portion of the state sales tax.

Lt. Gov. Jay Dardenne said it's not fair for the "pass through" spending to be unaffected, while the budget for his agency and others get cut.

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Jan Moller can be reached at jmoller@timespicayune.com or 225.342.5207.