Political Horizons for Oct. 18, 2009

• By MARK BALLARD
• Advocate Capitol News Bureau
• Published: Oct 18, 2009

• Print
• Email
• Save
• Reprints
• Twitter
• Share

• Del.icio.us
• Digg
• Facebook
• Reddit
• 

Back in late 1960s, when The Beatles were a staple of AM radio and not a video game, a systems analyst came from Ernst&Ernst Management Consultants of Cleveland to study Louisiana government budgeting.

K.S. Caldwell expressed surprise that about 85 percent of government funds were “dedicated” by statute or by constitutional provision. He considered the amount abnormally high.

“Until you crack that, you will have an academic exercise in most other areas,” Caldwell told legislators in January 1969. “It almost should be your No. 1 priority.”

Caldwell said the dedications took away lawmakers’ say-so over 85-cents of every $1 in the state budget, which was about $1 billion back then. (The portion of the annual budget funded by state taxpayers now is nine times higher.)

Dedications require that specific pots of money be spent only on specific projects. In some cases, voters refused to approve tax increases unless there was some guarantee that the money would be spent as promised. In other cases, special interests changed the laws to ensure taxpayer dollars for their little corner. Earmarks are off-limits. This is why you hear so much about  hacking spending for unprotected services like higher education and health care when state officials try to balance the government’s budget.

An example is the Poverty Point Reservoir Development Fund, which uses $650,000 a year in revenue to help maintain a retirement development and the Black Bear Golf Club. Their 2006 statutory dedication allows the development to collect and keep fees, thereby not have to fight for state funding each year.

In March 1988, the Louisiana Legislature passed Senate Bill 5, which then-Gov. Buddy Roemer signed into law as one of his first acts as the state’s chief executive. It abolished special funds — with a few exceptions — and put that money back in the state’s general fund.

The number of “dedicated” funds dropped from 197 to 78, according to the state  Treasury Department.

The concept was assaulted from all political quarters almost from the very beginning. Less than a month after the bill was signed, for instance, the state Legislature’s Republican delegation demanded a constitutional amendment requiring a two-thirds vote before suspending the dedication of funds that had been earmarked when a tax was enacted.

Like an alcoholic who believes one little drink won’t affect his sobriety, the state Legislature added one budget dedication, then another, then another until the number grew to 195 seven years later. It continues to grow.

“We have a history of this going back to the 1800s,” said State Treasurer John N. Kennedy, a Republican whose department is in charge of keeping up with taxpayer dollars. Kennedy said he understands why: Lawmakers want to protect a favored project once they are out of power.

Practical politics here translates to a state policy saying that the flagship university, LSU, which has to fight for funding each year, is less important than, say, the anti-littering campaigns of the Keep Louisiana Beautiful Fund, which does not, Kennedy noted.

Two decades have passed since the Legislature swore off earmarks, the number of statutory dedications today stands at 392, which ties up about $3.9 billion, Angèle Davis, the state Commissioner of Administration, testified recently. That’s money that could be used to offset funding shortages for other programs, she said.