(The Center Square) − The $47 billion state operating budget is on its way to Gov. Jeff Landry, who has bragged about a renewed ethos of fiscal responsibility.
The current operating budget is what Landry calls a “standstill” budget: agencies are mostly funded at current levels and spending remains flat.
But the operating budget is only one piece of the state’s spending package. While House Bill 1 pays for the ordinary operations of state government, lawmakers also advanced separate measures for state construction at hospitals and universities, supplemental spending, legislative expenses and the courts.
Those bills can authorize or move billions of dollars outside the headline operating budget.
For instance, next year’s construction budget will top $14.6 billion in total means of financing, up from about $8.8 billion in 2022 and about $2 billion from last year, though not all of that money would be spent right away. Much of it is authority for future projects and borrowing.
Of the $14.6 billion in the construction budget, $11.5 billion comes from bonds, with the rest coming from cash.
Spending on higher education is also increasing, including a $56 million formula bump for the Board of Regents.
Rep. Jack McFarland, R-Jonesboro, told The Center Square the Board of Regents sought the formula increase after Amendment 3 failed and argued the additional money would help universities close budget gaps.
In all, amendments to the originally proposed budget increased higher education spending by $150 million. Outside the operating budget and the formulas meant to provide equitable funding for universities, there are hundreds of millions in bonds for construction and infrastructure, including almost $400 million for LSU alone.
The formula increase will “allow campus leaders to advance strategic talent development efforts across the state, while capital outlay and deferred maintenance investments will help improve campus facilities,” Kim Hunter-Reed, Louisiana’s Commissioner of Higher Education, told The Center Square.
“This funding, along with legislation to strengthen anti-hazing measures, allow part-time students to receive TOPS Tech funding, and approve a more secure 529 savings plan, represent a few of the significant legislative wins that will make a meaningful difference for our learners,” Hunter-Reed continued.
The budget also includes pay raises for various state employees. District court, appellate and Supreme Court judges secured raises of up to $12,000. Firefighters dedicated to stopping forest fires secured a $10,000 raise, and corrections officers will receive a $3 hourly raise.
Preparing the state’s workforce to take advantage of the $100 billion in investment in Louisiana has been a priority this legislative session. The budget and several new laws reflect that priority.
Among the amendments made to the operating budget was $31 million for the newly established Office of Business Workforce Solutions within Louisiana Works. That money pales in comparison, however, to other funding meant to develop the state’s workforce.
The Office of Workforce Development is funded at more than $200 million, meant to “promote a stable, growth-oriented Louisiana.”
To further support that effort, the construction budget includes several “workforce hubs” and “training centers” totaling $91 million.
The budget was adjusted to reflect falling revenue projections of $113 million for the current year and $104 million for next year, which required some spending proposals and legislation to be put on hold.
“In its amended form, HB1 now balances the budget within the new revenue forecast, while continuing to prioritize paying down debt, improving our state’s roads, supporting Louisiana students, and attracting new industries with higher-paying jobs to Louisiana – all without raising taxes,” the House of Representatives said in a statement.
Still unresolved is the question of teacher stipends, which had cost the state about $200 million. After voters rejected Amendment 3, the funding mechanism for those stipends disappeared, meaning teachers are currently set to lose $2,000 a year in pay.Landry said last week he will convene a task force to recommend changes to the state’s K-12 funding formula in an effort to restore the stipends.
