Lawmakers call for careful spending of ‘last’ budget surplus

• By MICHELLE MILLHOLLON
• Advocate Capitol News Bureau
• Published: Oct 25, 2008 - Page: 1A - UPDATED: 12:05 a.m.

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The financial woes unfolding across the country are making Louisiana lawmakers cautious about spending an $865 million state government surplus.

Some legislators said they want to spend a large portion of the extra money on construction projects and roads. Others are hesitant about writing a wish list just yet.  No one appears to be in a big hurry to spend it.

The surplus may be the state’s last for a while, “So we need to make sure we’re efficient and wise with this money,” said Senate Finance Committee Chairman Mike Michot, R-Lafayette.

State Sen. Sharon Broome, D-Baton Rouge, called on legislators to be good financial stewards because of the economic problems.
“We’ll exercise frugality,”  said Broome, who holds the No. 2 leadership spot in the  Senate.

Booming oil prices are largely responsible for the surplus for the state fiscal year that ended June 30. But economists are warning officials the state is facing a financial downturn. 

State revenue collections are flat or declining with falling oil prices, which contribute money to the budget through production on state land and severance taxes.

For the new spending year, the state is expected to be short $1.3 billion just to continue what was funded in the current spending year that ends June 30.

The surplus cannot easily resolve the looming financial problems. The state constitution limits surplus spending to one-time expenses like roads, infrastructure, reducing state debt and coastal restoration.

Legislators divvied up a $1 billion surplus earlier this year among roads, public universities and the coast.

Several lawmakers said the Jindal administration agreed some time ago to spend 25 percent of the $865 million surplus on a backlog in construction projects.

The state is trying to chip away at $1 billion in commitments that greatly curtail the number of new projects that can be funded.

State Sen. Rob Marionneaux, D-Grosse Tete and chairman of the Senate committee that oversees the state construction budget, said he expects the administration to keep its word.

“Several of the senators believe that’s what we should do with it,” he said.