‘Rainy day’ funds in mix

• By SARAH CHACKO
• Advocate Capitol News Bureau
• Published: Jun 2, 2009 - Page: 1A

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Gov. Bobby Jindal said Monday he would support using “rainy day” money and other funds to plug holes in higher education.

Meanwhile, the Louisiana House’s main money committee delayed use of “rainy day” funds to resolve budget problems.

The House Appropriations committee set aside House Bill 497, which would require “rainy day” funds to be used solely for higher education when the state is facing a budget deficit.

The panel also postponed action on House Concurrent Resolution 160, which would authorize the use of “rainy day” funds this year.

The “rainy day” fund is money from surpluses and other sources from previous years set aside to mitigate budget deficits.

Last month, the House reduced proposed higher education cuts with various available funds, including about $50 million from a tax amnesty program.

But as the budget bill went to the Senate, concerns were raised that the tax amnesty money might not be available in time to fix next year’s budget holes, Jindal said.

The Senate is considering using money from the Budget Stabilization Fund, commonly called the “rainy day” fund. One-third of the fund can be accessed during a deficit.

Then as tax amnesty money comes in, it can refill the “rainy day” fund, he said.

Jindal said he supports the idea as long as it meets two criteria: there is enough money left in the fund for future budget deficits and greater budget issues are not created by dependency on one-time dollars.

Republican Baton Rouge Reps. Franklin Foil and Steve Carter released a statement Monday also in support of using “rainy day” money to offset higher education cuts.

The state is facing a $1.3 billion drop in revenue in the fiscal year that starts July 1. Higher education was initially proposed to be cut by $219 million.

Larger budget deficits are on the horizon, Jindal said. Higher education officials have argued they need time to transition and become more efficient, he said.