The state of Louisiana has five budgets: operating, capital outlay, legislative, judiciary and ancillary. Of the five, the operating budget is the top priority. “Far and away, the most important bill that sets policy for the state of Louisiana is the operating budget,” said State Treasurer John Kennedy.
The state of Louisiana has five budgets: operating, capital outlay, legislative, judiciary and ancillary. Of the five, the operating budget is the top priority.
“Far and away, the most important bill that sets policy for the state of Louisiana is the operating budget,” said State Treasurer John Kennedy.
Subtracting the one-time hurricane money, the current fiscal year’s operating budget, which runs from June 2008 to June 2009, is close to $28 billion as compared to $11.9 billion in 1996. Kennedy discounts inflation, which has increased by 37 percent since 1996, and population increase, which actually has decreased by 4 percent since 1990, as major causes for the drastic increase.
“Our budget is larger today because the government, the state government, spent the money,” said Kennedy.
The State Treasurer visited the Southwest Louisiana area on Wednesday afternoon, giving a brief overview of the state’s operating expenses to the Greater Lake Charles Rotary Club.
In the operating budget, labor costs amount to over $5 billion.
“We spend an enormous amount of money on labor,” said Kennedy, “We have 103,775 state employees. Our total labor cost every year, with benefits, is roughly $5.4 billion.”
Almost $6 billion is devoted to paying the state’s debt on money borrowed.
“Our net state tax afforded debt is about $5.9 billion dollars,” said Kennedy.
According to the treasurer, the per capita debt is about $1,369 for every man, woman and child in the state. He compared this number to 2001’s figure of $523.
“Our state debt is up two and a half times in seven years.”
Education accounts for $7.6 billion of the budget. Kennedy estimates that the state spends around $10,456 per student, which is 70 percent more than 10 years ago. And while he praises the TOP program and the state’s university and community college system, he finds fault in the elementary and secondary school system.
“Our problem, as you well know, is elementary and secondary education, and it is a huge problem,” said Kennedy, “ And it is a problem that money alone hasn’t solved, at least not yet, and I don’t think it will.”
Graduation rates have only moved from 56.67 percent 10 years ago to 57.5 percent currently, and 77 percent of schools are failing with students not scoring at least basic level on leap tests, according to Kennedy.
“Sometimes, its not how much money you’re spending, its how you’re spending the money.”
The portion for health care has gone up 90 percent from 10 years ago to $7.6 billion. Out of a total population of 4.2 million people, 1.8 million in Louisiana are either on Medicare or Medicaid. And the state ranks in the top five in problem areas such as obesity, premature deaths, heart disease, cancer deaths and infant mortality. Kennedy pointed out, however, that it is not the quality of care in the state that has brought costs up but rather the way the state has chosen to deliver that care.
“We emphasis institutional care at the expense of preventive and primary care,” said Kennedy.
The Department of Transportation and Development receives about $1.2 billion, about half of which comes from federal funds, with around $500 million of that figure dedicated to overhead costs. With only around $700 million left for roads, it has created a backlog of projects worth billions.
But not all the news is bad. Despite the current economic problems of the nation, Louisiana is doing better than most states. Kennedy pointed out that personal income taxes have been cut and unemployment is only at 5.9 percent as compared to the national average of nearly 8 percent. He also believes that the state can easily make a billion dollars in cuts if it focuses only on what is needed and away from what is desired.
“Taxpayer dollars are not unlimited,” said Kennedy, “They are precious.”
Southwest Daily News