state of louisiana joint legislative committee on the budget march 16, 2007 kathleen babineaux...

State of LouisianaState of Louisiana

Joint Legislative Committee on the Budget

March 16, 2007

Kathleen Babineaux Kathleen Babineaux BlancoBlanco

GovernorGovernor

Executive Budget

Fiscal Year 2007-2008

2

REVENUES

3

General Fund AvailableCompared to EOB Freeze on 12/1/06

STATE GENERAL FUND

Fiscal Year 2006 Surplus $ 827

Fiscal Year 2007 Excess General Fund $1,222

Fiscal Year 2008 Increased General Fund $1,292

Available General Fund for

Fiscal Years 2006-2007 & 2007-2008 $3,341

(in millions)

4

In December and February, the REC recognized continued strength in general fund revenue for FY07 and FY08

The strength was mainly due to:

• Robust economic activity generated by recovery and Robust economic activity generated by recovery and rebuilding effortsrebuilding efforts

• An extended period of high oil pricesAn extended period of high oil prices

General Fund Revenue

5

0

2,000

4,000

6,000

8,000

10,000

12,000

94 95 96 97 98 99 00 01 02 03 04 05 06 07* 08*SFY

$ Million

Taxes, Licenses and Fees

* current forecast

6

0

10

20

30

40

50

60

70

94 95 96 97 98 99 00 01 02 03 04 05 06 07* 08*SFY

$/barrel

West Texas Intermediate Oil Price

* current forecast

7

0

2,000

4,000

6,000

8,000

10,000

12,000

94 95 96 97 98 99 00 01 02 03 04 05 06 07* 08*SFY

$ Million

State General Fund Revenue

* current forecast

8

0.0

0.4

0.8

1.2

1.6

FY 2004-05 FY 2005-06 FY 2006-07Budget Stabilization Elderly Millennium LEQTF

$ Billion

FY 2004-05

$3.4 BillionFY 2005-06

$3.7 BillionProjected to 6/30/07

FY 2006-07

$3.8 Billion

Trust Fund Balances

9

EXPENDITURES

10

FY 06-07 Budgeted vs. FY 07-08 Recommended (In $ Millions, Exclusive of Double Counts and Inclusive of Contingencies)

Budgeted FY 06/07

As of 12/1/06Recommended

FY 07-08

RecommendOver/

(Under) Budgeted

% Change

General Fund Direct $7,320.8 $8,459.1 $1,138.3 15.55%

General Fund By:

Fees & Self Generated $1,402.2 $1,431.8 $29.6 2.11%

Statutory Dedications $4,452.9 $3,741.2 ($711.8) (15.98%)

Interim Emergency Board $1.2 $0.0 ($1.2) 100.00%

TOTAL STATE FUNDS $13,177.1 $13,632.1 $455.0 3.45%

FEDERAL FUNDS $15,582.4 $15,563.6 ($18.8) (0.12%)

GRAND TOTAL $28,759.5 $29,195.7 $436.2 1.52%

Positions 45,763 46,776 1,013 2.21%

11

FY 07-08 State General Fund Expenditures, by Functional Area

Business & Infrastructure

1%

Environment & Natural

Resources1%

Human Resources

23%

Public Safety10%

General Government

9%

Education56%

12

FY 07-08 Total Expenditures,by Functional Area

Business & Infrastructure

8%

Education26%

Environment & Natural

Resources2% General

Government23%

Human Resources

29%

Public Safety12%

13

MAJOR BUDGET CHANGES

Pay Raise and Supplemental Pay

14

Recommended Salary Pay Increases

Total Funding

Recommended

Teachers ($2375 to reach SREB average) $ 157.6 Million

Higher Education Faculty $ 30.0 Million

Support Workers $ 33.9 Million

State Employees $ 142.6 Million

Corrections, Probation, and Parole Officers(including OMH and OYD) $ 35.1 Million

State Police and Commissioned Officers $ 2.8 Million

Supplemental Pay $ 28.3 Million

TOTAL (including $365 Million General Fund) $ 430.4 Million

15


Higher Education

16

Major Changes

Higher Education Funding

$98.1M to fully fund the formula at 100% Formula Funding

$16.9M to provide 3% Flexible Funding for formula institutions currently at the 100% formula level and non-formula institutions

17

Major Changes

Higher Education Initiatives$30M for a faculty pay increase$27.4M for a state worker pay increase$33.2M for mandated costs$12.5M in recurring funds for Library

and Scientific Acquisitions

18

Major Changes

Higher Education Initiatives $10M for hurricane-affected campuses to assist

with faculty recruitment and retention and to recover research and operation capacity

$2M for the Community and Technical College Development Pool for accreditation and new program development needs

$13M for workforce development including the Pathways to Construction Employment Initiative and Nursing and Allied Health Professionals

19

Major Changes

Higher Education InitiativesFinancial Aid Initiatives

$15M for need-based scholarships and grants $3m for the Dual Enrollment Initiative $4.5 million for student loan guarantees is

continued for the Louisiana Office of Student Financial Assistance (LOSFA)

20

Major Changes

Higher Education Initiatives Targeted Investments

$3.2M for the Louisiana Immersive Technologies Enterprise (LITE)

$3M for Research at Pennington

$1M for the ULM School of Pharmacy

21


Education

22

Louisiana is recognized nationally as an educational leader in venues such as Education Week. Louisiana ranks 1st in Education Accountability

and Standards for the third year 1st in Improving Teacher Quality 6th in Equity of funding

PreK-12 Education

23

91% of Louisiana teachers met state standards and were certified last year, up from 10-year low of 84% during Fiscal Year 2001-2002.

Louisiana’s ACT average composite score for all students increased to 20.1 in 2006 from 19.8 in 2005.

PreK-12 Education

24

Teachers ($2,375 to reach SREB average)

$156.4 Million

Support Workers ($750) $ 32.8 Million

MFP funding at Continuation based on the FY 06/07 formula

$155.4 Million

K-12 Education

Major Changes

25

PreK-12 Education The Governor committed to providing “at risk”

children the opportunity to participate in early childhood education

$30 Million additional General Fund for LA4 Early Childhood Education in public schools

$112.2 Million total funding for LA4, including General Fund and 8(g) block grants for public schools

$8.5 Million in TANF funding maintained for Private PreK

Major Changes

26

PreK-12 Education

$13.0 Million increased funding for High School Redesign

$1.4 Million additional State General Fund is recommended for Type 2 Charter Schools providing for additional students; total funding is now $24.8 Million for (8) existing Type 2 charter schools

Major Changes

27

PreK-12 Education

$4.8 Million additional General Fund provided for Summer School Remediation

$1.0 Million additional General Fund provided for a New Orleans initiative to attract matching foundation funds to increase the number of principals.

Major Changes

28


Health Care

29

Major ChangesMedical Vendor Payments

(Total Funds)

Private Provider Services $401 Million increase

Public Provider Medicaid $76 Million increase

Uncompensated Care Costs payments $17 Million increase

30

Major ChangesPrivate Providers Program

(changes from existing operating budget)

Increase of $401 Million in the Private Providers Program for: Health Care Redesign Initiatives -$198M

New and/or expanded programs - $191M Total ($53M State) 100 Emergency Waivers - $7M Total ($2M State)

Direct service workers pay increase - $113M Total ($32M SGF)

750 New Waivers - $18M Total ($5M SGF) Annualize Programs started in FY07 - $64M Total

($14M SGF) Mandated Increases - $3M Total ($1M SGF)

31

Major ChangesMedicaid & UCC Payments

(changes from existing operating budget)

Increase of $76 Million in the Public Providers Program

Increased Title XIX fundingHCSD - $50M Total ($14M SGF)OCDD - $24M Total ($7M SGF)

Increase of $17 Million in the Uncompensated Care Costs Program

Maintains current year UCC for the Community, Rural and High-Medicaid Hospitals

HCSD and LSU-S/EAC - $28M ($5M SGF) Approximately $44M under the $1B DSH Cap

32

Other Major Changes (changes from existing operating budget)

Non-recur Federal Katrina Waiver $292M Increase funding in:

Office of Mental Health, Human Service Districts and Authorities ($24M SGF – Supervised and Independent Living for Mental Health patients)

Office of Addictive Disorders ($8M SGF – 20 hospital-based detoxification beds and 30 bed Co-occurring unit)

33


Families and Children

34

Major Changes

Temporary Assistance for Needy Families Approximately $73.6 million in federal TANF

funding is recommended to continue existing TANF initiatives.

New initiatives include: General Education Development (GED), $500K Jobs for America’s Graduates (JAGS), $500K Head Start, $5M Nurse Family Partnership, $2M

35

After School Education Enhancement

Private Pre-K Truancy Jobs for America’s

Graduates (JAGS) GED Microenterprise Teen Pregnancy Prevention CASA Drug Courts Substance Abuse Treatment Substance Abuse

EITC Alternatives to Abortion Community Response CPI/Family Services Fatherhood Initiative Domestic Violence Freedom Schools Homeless Head Start Nurse Family Partnership Early Childhood Supports

TANF InitiativesFunded in FY 07/08

36

Major Changes

Social Services: $11.4M SGF to serve eligible clients with

disabilities in Louisiana Rehabilitation Services $8.4M SGF to offset the impact of the Deficit

Reduction Act which decreases Title IV-E administrative and maintenance cost received for the foster care program

An increase of 50 positions and $1.3M SGF to address understaffing, heavy caseloads, excessive overtime and turnover in the foster care program

37

Major Changes

Juvenile Justice: Overall budget increase of $28.8M or 19% from EOB

along with 81 positions $4.6M increase in State General Fund and 72 positions for

Bridge City for implementation of the LAMOD model. $9.0M total funding recommended for the new Acadiana

Correctional Center for Youth (ACCY). $5.9M in State General Fund (SGF) and 87 positions transferred from Jetson Correctional Center for Youth to ACCY, along with an additional $3.0M in SGF for this effort

38

Major Changes

Juvenile Justice

$657K to provide mental health beds to the mentally ill and mentally challenged delinquents.

Provides an additional $3.0 Million for medical, dental and mental health services for the youth.

Provides an additional $4.3 Million for a pay raise for Correctional Security Officers, Youthcare Workers, and Probation and Parole Officers.

39

Juvenile Justice

0

200

400

600

800

1,000

1,200

1,400

1,600

FY 03-04 FY 04-05 FY 05-06 FY 06-07 FY 07-08Projected

Secure Care Average Daily PopulationCommunity-based Average Daily Census

Transitioning to community-based services.

40


Economic Development

41

Major Changes

Economic Development $6M SGF continues for the Economic Development

Regional Awards and Matching Grant Program $10M continues for Rapid Response Fund $5.5M continues for advertising, promotion and

marketing $20M Capital Outlay for NASA equipment acquisitions

and manufacturing facility modifications $1M for transportation drayage due to MRGO closure $7.3M to continue LaSwift bus service in DOTD

42

Major Changes

Culture, Recreation & Tourism $2.5M for additional sporting events:

2008 NBA All-Star Game 2008 NCAA Women’s Basketball Regional Final

$1.2M continues for the Essence Festival $1.5M additional state aid to local public libraries $1.1M additional state aid to New Orleans City Park $1M to aid State Museums in the rebuilding of exhibits

impacted by the hurricanes $1M to expand international cultural relations, including

World Cultural Economic Forum in N.O. in the Fall of 2007

$4.6M additional cultural and tourism enhancements to aid tourism industry recovery

43


Public Safety and Corrections

44

Major Changes

Public Safety Services: $2.4M for a pay increase for State Troopers and DPS

Commissioned Officers

$3.5M of total funding for the Uniform Construction Code Council (UCCC) to assist local governments in implementing the state’s new uniform building code

$4.6M of total funding in State Police for fleet replacement of 482 vehicles

$34.8M increase in State General Fund to allow Transportation Trust Funds to remain with the Department of Transportation and Development

45

Major Changes

Public Safety Services: $5.9M to fund a 50-member cadet class and increase the

number of State Troopers on the road by 50 7 positions and $1.1M of funding will allow the State Fire

Marshal to avoid delays in plan review and inspections, which could impact Louisiana’s rebuilding efforts and jeopardize public safety

Governor’s Office: $11.5M provides for addressing Interoperability issues

statewide, which brings the total investment to $20.3M since FY 2006-2007

46

Major Changes

Corrections Services: Provides $9.8M and 259 positions for the operation of a

273-bed skilled nursing/geriatric health care unit at Elayn Hunt Correctional Center

Provides $3.9M for 60 Probation and Parole Officers to provide supervision to sex and violent offenders

Provides $2M for the Correction’s Substance Abuse Program to expand counseling efforts

$1M and 20 positions provided for J. Levy Dabadie Correctional Center to expand the facility by an additional 80 beds

47

Major Changes

District Attorneys and Assistant District Attorney: $3.5M provided for a pay increase for the Assistant

District Attorneys

Enabling Legislation - Act 790 of the 2006 Regular Legislative Session

Effective July 1, 2006 - annual salary of each assistant district attorney grew from $30,000 to $35,000

Effective July 1, 2007 - annual salary of each assistant district attorney will grow from $35,000 to $40,000

48

Major Changes

Supplemental Pay: Supplemental Pay to eligible law enforcement

personnel will increase from $300 per month to $425 per month ($1,500 annual pay raise)

The $28M increase will provide:● $12M additional funding for Deputy Sheriffs

● $9M additional funding for Municipal Police

● $7M additional funding for Local Firefighters

49

Major Changes

Local Housing of State Adult Offenders

$33.8M additional for housing state offenders in parish and local facilities

$6.6M increase to fund a $1 increase in the per diem rate of both Local Housing of Adult Offenders and the Adult Work Release Program

50


Infrastructure

51

Major Changes

Infrastructure $10M SGF continues to supplement existing CDBG

program for local infrastructure needs. $30.2M continues for Non-Federal Aid eligible state

highways $1M to begin re-licensing of Toledo Bend Project – Sabine

River Authority

Parish Transportation Program $40M parish road maintenance continues

$34M for distribution to parishes on a per capita basis $6M for distribution to parishes on a per mile basis

52

Major Changes

Transportation Trust Fund - $34.8M non-recurred in Public Safety – Traffic Enforcement for use in DOTD/Infrastructure: $25M Highway Priority Program $7M increase in District Operations – Contract

Maintenance $1.3M increase to Metropolitan Planning Organizations to

maintain transportation plans and programs for urbanized areas.

53


Resources and Environment

54

Major Changes

Natural Resources $1M and 13 new positions to expand the Well Inspection program. $25.6M additional Coastal Restoration funding $1.5M additional Underwater Obstruction cleanup assistance for

hurricane damage repair $500K to each of the Southeast Louisiana Flood Protection

Authorities (East and West Bank)

Wildlife & Fisheries An additional $4M of funding is provided to expand Louisiana

Department of Wildlife and Fisheries’ efforts to control aquatic vegetation

Major Changes

55


General Government

56

Major Changes

General Government: $7.5M increase for Louisiana Indigent Defense

Assistance Board, this brings the total to $27.5M $500,000 and 11 positions were added to

implement Child Advocacy Program as a result of recommendations from the Task Force on Legal Representation in Child Protection Cases

$3.6M to Orleans Parish for the casino support services contract

57

Major Changes

General Government:

$3.5M and 35 positions is provided for disaster recovery Project Management in the Office of Facility Planning and Control

State Match for Public Assistance $6.2M and Hazard Mitigation $4.5M is provided

State Match for Repatriation $67.3M is provided

58

Major Changes

General Government:

$3.8M provides funding for 63 positions for GOHSEP, of which $1.6M is SGF

3.4M provides funding and 77 positions for the State Military Department

$2.1M provides funding for major repairs and acquisitions for Military facilities statewide

59

Major Changes

Department of Veterans Affairs: The FY 2007-2008 Executive Budget supports

Louisiana’s war veterans by providing additional funding to annualize and expand the services of three war veterans’ homes within the State. Annualization of the Northwest LA War Veterans

Home and Southeast LA War Veterans Home Southwest La War Veterans Home will open a

fourth wing in FY 2007-2008.

60

RECAP

Spending the Increased General Fund Available

61

Fiscal Year 2008(in millions)

FY08 Increased General Fund Revenue $1,292Reserved for Governor’s Proposed Tax Cuts ($ 150)Reserved for Removal of cap on Tourism Dedication ($ 4)Available Revenue from FY08 Increased GF Revenue $1,138

General Fund Expenditures:Pay Raises and Supplemental Pay $ 365Statewide Adjustments $ 71Education $ 221Health Care $ 184Higher Education $ 116Public Safety $ 41Social Services $ 28Other Requirements $ 25Other Departments $ 87Total General Fund Expenditures $1,138

62


Pay Raises and Supplemental Pay $365

Statewide Adjustments $ 71 Merits $36 Group Insurance $23 Retirement $21Net Other Statewide Adjustments $14 Non-Recur Carryforwards ($23)

63


Education $221 Expansion of LA-4 Program Summer School Remediation Fully fund MFP formula (2.75% normal growth)

Health Care $184 Healthcare redesign and reform initiatives Rate increase for direct care service workers Community Hospital Pool Annualization of programs

64


Higher Education $116 Full funding of the formula; 3% Flexible Funds Library and Scientific acquisitions Targeted Investments:

Pennington, ULM Pharmacy, and the Louisiana Immersive Technologies Enterprise

Public Safety $ 41 General Fund to replace TTF that will remain in DOTD for roads 50-member cadet class 482 vehicles Crime Lab

65


Social Services $ 28 Additional services to individuals with disabilities Match for Support Enforcement Incentive Funds Foster Care Services

Other Requirements $ 25

Sheriff’s Housing Assistant District Attorney pay increase

66


Other Departments, including: $ 87 Youth Development – Acadiana Correctional Center Corrections – Expansion of the Elayn Hunt Correctional Center’s Special Needs Facility Corrections – 80-bed expansion at J. Levy Dabadie Correctional Center Corrections – 60 Probation and Parole Officers to provide supervision to

sex and violent offenders Attorney General – Forensic Lab expansion Need-based financial aid Indigent Defense for litigation Homeland Security for additional personnel Military for additional personnel

67

GOVERNOR’S PROPOSED TAX CUTS

68

Governor’s Proposed Tax Cuts

Refundable Child Tax Credit $45.7

5-day Sales Tax Holiday $6.8

½¢ Decrease in Business Utilities Sales Tax $36.0

Quality Child Care Tax Credit $44.4

Economic Development Tax Incentives $4.6

TOTAL TAX CUTSTOTAL TAX CUTS $132.9$132.9

(in millions)

69

EXPENDITURE LIMIT

70

Expenditure Limit

Official Expenditure Limit for Fiscal Year 2006-2007

$10,318,239,142

Growth Factor 12.42%

Expenditure Limit for Fiscal Year 2007-2008 $11,599,764,443

Appropriation Acts and Other Requirements $11,180,571,635

Appropriation Acts and Other Requirements Over/(Under) Expenditure Limit

($419,192,808)

71

USE OF 2006 AND 2007 AVAILABLE FUNDS

72

Use of FY 2006 Available Funds

Fiscal Year 2005-2006 Surplus $827

Proposed Investments: Roads $450 Coastal Fund $200 Infrastructure for steel mill project $100 Higher Ed Deferred Maintenance $ 77

(in millions)

73


Contemplated in the Executive Budget:Medical Assistance Trust Fund for Medicaid $330Health Care Redesign $200FEMA Match, including Repatriation $ 78Information Technology Projects $ 34LA Housing Finance Agency Programs $ 25NASA-Lockheed Martin Equipment $ 20Interoperability $ 12Family Recovery Corps $ 10Other $ 62

Total Contemplated in the Exec Budget $771

(in millions)

74


Supplemental Needs:Community Clinic Infrastructure -

Supplemental Capital Outlay $ 55Sheriff’s Housing $ 28FEMA reimbursements not received (Medicaid) $ 16HSC Shreveport and E. A. Conway $ 14MFP (February pupil count) $ 10Other $ 33

Total Supplemental Needs $156

(in millions)

75


FY 2007 Excess General Fund $1,222

Proposed Uses: Contemplated in the Executive Budget $ 771 Supplemental Needs $ 156

Total Proposed Uses $ 927

Excess General Fund Remaining $ 295

(in millions)

76


Proposed Investments:Category A and B Match $100

Catastrophic Insurance Pool $100

Cancer Center $ 38

Classroom Technology $ 25

(in millions)

state of louisiana joint legislative committee on the budget march 16, 2007 kathleen babineaux...

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