Jindal plan would cut $341 million
State workers, supplies reduced
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Gov. Bobby Jindal proposed a plan Tuesday to cut $341 million in spending by reducing health-care costs, laying off workers and scaling back on BlackBerries.
“Some think the job of government is simply to collect taxes and spend money. I do not subscribe to that view,” Jindal said during a news conference at the State Capitol.
Jindal was able to immediately cut $162 million in the current budget year that ends June 30. The rest of the cuts are merely a recommendation unless legislators agree to them at a meeting next week.
The recommended cuts to health care and higher education are lower than anticipated but still sizable.
The state’s public colleges and universities, for example, initially were told to expect to trim spending by $109 million. Instead, Jindal is recommending $55 million in cuts.
Health care would lower costs by $118 million, partly by reducing the number of prescriptions that many Medicaid recipients can receive per month.
The governor said the state has to live within its means in light of a reduction in revenue.
Economists attribute a downturn in state revenue to slumping oil prices and the national recession. The revenue drop forced the governor to make midyear cuts to the state operating budget for the fiscal year that ends in June.
Through an executive order, Jindal cut $163 million. The state constitution allows him to trim 3 percent of the state general fund by budget unit.
The Joint Legislative Committee on the Budget will have to approve the remaining $178 million in cuts that the governor is recommending. The committee meets Jan. 9.
Jindal’s proposal calls for health care and higher education to bear the brunt of the cutbacks because of the amount of state general fund revenue they receive.
The balance of the state’s general fund is lower than expected because of slumping mineral revenue and decreased tax collections.
The governor said he wants to shield the Pennington Biomedical Research Center and the state’s community colleges from cuts.
He said higher education still received an increase in state general fund dollars compared to last year even with a $55 million reduction.
Jindal said individual campuses will decide how to lower costs.
Cuts in state dollars for health care typically lower the amount of federal funds the state receives. The federal government rewards states for putting up dollars by matching them with federal funds.
State Health Care Secretary Alan Levine said he plans to mitigate the $118 million reduction by shifting money from other places to draw federal dollars.
Jindal said he does not want to cut Medicaid rates for rural hospitals, the LSU charity hospitals, physicians or nursing homes.
However, Medicaid recipients would be limited to five prescriptions a month instead of eight unless they can justify a medical necessity.
Levine said Texas’ limit is three prescriptions a month.
The state also plans to cut back on consultant contracts for services for individuals with developmental disabilities.
Other recommendations include:
The shortfall for the upcoming year is even greater.
For the spending year that ends in June, the current general fund is $9.4 billion. Next year, $8.2 billion in revenue is expected to be generated for the state general fund, a drop of more than $1 billion.
The Jindal administration estimates next year’s shortfall as $2 billion once costs such as rising expenses are included.
Adding to the state’s financial problems is a $359 million income tax break that goes into effect next year. The tax cut will put more money into taxpayers’ pockets while draining state coffers.
“Some think the job of government is simply to collect taxes and spend money. I do not subscribe to that view,” Jindal said during a news conference at the State Capitol.
Jindal was able to immediately cut $162 million in the current budget year that ends June 30. The rest of the cuts are merely a recommendation unless legislators agree to them at a meeting next week.
The recommended cuts to health care and higher education are lower than anticipated but still sizable.
The state’s public colleges and universities, for example, initially were told to expect to trim spending by $109 million. Instead, Jindal is recommending $55 million in cuts.
Health care would lower costs by $118 million, partly by reducing the number of prescriptions that many Medicaid recipients can receive per month.
The governor said the state has to live within its means in light of a reduction in revenue.
Economists attribute a downturn in state revenue to slumping oil prices and the national recession. The revenue drop forced the governor to make midyear cuts to the state operating budget for the fiscal year that ends in June.
Through an executive order, Jindal cut $163 million. The state constitution allows him to trim 3 percent of the state general fund by budget unit.
The Joint Legislative Committee on the Budget will have to approve the remaining $178 million in cuts that the governor is recommending. The committee meets Jan. 9.
Jindal’s proposal calls for health care and higher education to bear the brunt of the cutbacks because of the amount of state general fund revenue they receive.
The balance of the state’s general fund is lower than expected because of slumping mineral revenue and decreased tax collections.
The governor said he wants to shield the Pennington Biomedical Research Center and the state’s community colleges from cuts.
He said higher education still received an increase in state general fund dollars compared to last year even with a $55 million reduction.
Jindal said individual campuses will decide how to lower costs.
Cuts in state dollars for health care typically lower the amount of federal funds the state receives. The federal government rewards states for putting up dollars by matching them with federal funds.
State Health Care Secretary Alan Levine said he plans to mitigate the $118 million reduction by shifting money from other places to draw federal dollars.
Jindal said he does not want to cut Medicaid rates for rural hospitals, the LSU charity hospitals, physicians or nursing homes.
However, Medicaid recipients would be limited to five prescriptions a month instead of eight unless they can justify a medical necessity.
Levine said Texas’ limit is three prescriptions a month.
The state also plans to cut back on consultant contracts for services for individuals with developmental disabilities.
Other recommendations include:
- Eliminating on-hold music for telephone callers.
- Reducing travel.
- Cutting back on office supplies, including computers and file cabinets.
- Preventing state workers from buying items to organize their work spaces.
- Firing 70 student workers at the Department of Corrections.
The shortfall for the upcoming year is even greater.
For the spending year that ends in June, the current general fund is $9.4 billion. Next year, $8.2 billion in revenue is expected to be generated for the state general fund, a drop of more than $1 billion.
The Jindal administration estimates next year’s shortfall as $2 billion once costs such as rising expenses are included.
Adding to the state’s financial problems is a $359 million income tax break that goes into effect next year. The tax cut will put more money into taxpayers’ pockets while draining state coffers.
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