louisiana at the crossroads: responsible responses to louisiana’s financial crisis
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Louisiana at the Crossroads: Responsible Responses to Louisiana’s Financial Crisis. WWW.LABUDGET.ORG. 46 States Face FY11 Budget Shortfalls. 4-Year Base Line Projection. REC Forecast Change for FY10. REC Forecast Change December to June. Percent of Total Budget. - PowerPoint PPT PresentationTRANSCRIPT
Louisiana at the Crossroads:Responsible Responses to Louisiana’s Financial Crisis
WWW.LABUDGET.ORG1
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46 States Face FY11 Budget Shortfalls
(in millions) FY09 FY10 FY11 FY12State General Fund Revenue $9,490 $8,532 $7,776 $8,199State General Fund Expenditure $9,475 $9,046 $9,163 $10,522Adjustments $15 $53 $104 $104Cumulative Balance $0 ($567) ($1,491) ($2,427)
4-Year Base Line Projection
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(in millions) REC – 12/17/2009 REC – 4/14/2010 +/(-)Sales $2,559 $2,456 ($102)Individual Income $2,593 $2,467 ($126)Corporate $442 $392 ($50)Mineral $1,243 $1,113 ($130)Gaming $395 $390 ($5)Other $631 $726 $94Total $7,863 $7,544 ($319)
REC Forecast Change for FY10
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(in millions) December April June
FY2010 $7,863 $7,544 $7,282
FY2011 $8,021 $7,776 $7,719
REC Forecast Change December to June
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$2.4 billion ÷ $29 billion = 8%
Percent of Total Budget
3-year Cumulative Shortfall Total FY10 BudgetPercent of total FY10 budget to
be cut over 3 years
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FY10 Total Means of Financing
Federal51%
General Fund31%
Statutory Ded-ications
13%
Self-Generated5%
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$2.4 billion ÷ $9 billion = 27%
Percent of State General Fund Spending
3-year Cumulative Shortfall FY10 State General Fund Percent of FY10
state general fund to be cut over 3
years
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Discretionary vs. Non-Discretionary
Discretionary45%
Non- Discre-tionary
55%
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$2.4 billion ÷ $3.3 billion = 73%
Percent of Recurring Discretionary Spending
3-year Cumulative ShortfallPercent of FY10
recurring discretionary fund to be cut over 3 years
FY10 Discretionary Funds (minus one-time funds for
Capital Outlay)
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FY10 Discretionary Expenditures
Human Resources
35%Education
35%
General Government
4%Public Safety
4%Business & Infrastructure21%
Environment & Natural Re-
sources1%
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FMAP Rate Change
Oct. 2007 Oct. 2008 Oct. 2009 Oct. 2010 Jan. 20110.0%10.0%20.0%30.0%40.0%50.0%60.0%70.0%80.0%90.0%
72.0% 71.3% 67.7% 63.2% 63.2%
8.7% 12.3% 16.8%
Original FMAP Stimulus
80.0% 80.0% 80.0%
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Spending Reverts to Pre-Katrina Levels (in 2009 dollars)
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FY05 FY06 FY07 FY08 FY09 FY10 FY11 $- $5,000,000,000
$10,000,000,000 $15,000,000,000 $20,000,000,000 $25,000,000,000 $30,000,000,000 $35,000,000,000
Total State BudgetTotal State Budget Less Hurricane Disaster Recovery FundingState General Fund
Increases Since Pre-KatrinaFY05-FY10
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Community & Technical Colleges
Food Stamps
LACHIP
Medicaid
State General Fund Revenue
0% 10% 20% 30% 40%
37%
20%
16%
13%
2%
(in millions) FY08 FY09 FY10 FY11 FY12 5-Year Total
Excess Itemized Deductions $152 $250 $255 $260 $265 $1,182
Bracket Changes N/A N/A $359 $251 $262 $872
Total Cost $152 $250 $614 $511 $527 $2,054Source:Department of Revenue for Excess Itemized Deductions, except FY12, which is LBP estimateLegislative Fiscal Office for Bracket Changes
Fiscal Effect of Stelly Repeals
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$7.1 BILLION
5-Year Tax Exemption Budget
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State general fund revenues: $7.8 billion Cost of tax exemptions: $7.1 billion
Tax code spending equals 91.6% of SGF revenues
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FY 2011 Budget Projections
2006 2011 % Increase
Number 364 441 21%
Cost $5.6 Billion $7.1 Billion 28%
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Growth of Tax Exemptions2006-2011
Example:Of 179 sales tax exemptions, 90 are lumped under “Other Exemptions” at a cost of $3.8 billion of $4.7 billion or 80%
Example:Lack of assessment of each tax expenditure
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Tax Exemption Budget Needs More Transparency
Improved Tax Collections
$234 million – Delinquent taxes
recovered in the 2009 tax amnesty program
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State & Local Taxes in 2007
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Governors that Supported Tax Increases by PartyRepublican 55%Democrat 75%
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WWW.LABUDGET.ORG
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