In The News › More state budget cuts inevitable in 2017, Dardenne says

Sep 22, 2016

Source: Uptown Messenger

Filed under: Government Finance, Statewide, Taxes

More state budget cuts inevitable in 2017, Dardenne says

By Danae Columbus

Uptown Messenger

Sept. 22, 2016

Commissioner of Administration Jay Dardenne told the Bureau of Governmental Research today that the state will have no choice but to make additional cuts to departments and agencies of state government starting in January 2017 to balance the budget for the remainder of the fiscal year that ends June 30. It’s simply a matter of cash flow, Dardenne explained.

For example, Louisiana’s mineral revenue has fallen 32 percent since the 1981-82 budget year. For every $1 increase in the price of a barrel of oil, the state enjoys a $12 million benefit. The number of tax credits and exemptions for businesses has also significantly reduced the amount of funds available to the state annually. Since 2008, the state has relied on the use of one-time money and fund sweeps to fill the budget gaps.

Dardenne bemoaned the fact that Louisiana has the highest state sales tax in the U.S. He feels that short term the Great Flood of 2016 will be a drain on the state’s budget but will increase sales tax revenues in the near future. He also believes that Governor Edwards will be seeking more accountability on future exemptions and tax credits to ensure that businesses receiving them produce “quantifiable” results.

Citizens should expect more dramatic cuts before the end of the fiscal year, said Dardenne. “We’re sitting on a ticking time bomb,” he explained. There’s a shortage in revenues and not enough money to satisfy expenditures. He wished that Governor Edwards had more discretion on budget cuts to manage short falls.

Dardenne explained that Governor Edwards has created several task forces which are hard at work identifying new solutions to infrastructure and long-term funding issues. Their results should be available in the coming months.

Sep 22, 2016

Source: Uptown Messenger

Filed under: Government Finance, Statewide, Taxes

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