Jindal administration proposes Executive Budget for 2015-2016 fiscal year
The Joint Legislative Committee on the Budget met February 27 to hear the presentation of the Governor’s Executive Budget for the 2015-2016 fiscal year.
The state faces an uphill battle, starting a $1.6 billion deficit in the face.
To fill that hole, the governor’s office presented a $1.2 billion cut in the state budget. The proposal calls for a $526 million cut to refundable tax credits which includes changing the status of the inventory tax credit from refundable to non-refundable.
The other cuts suggested by the governor’s office that impact industry are:
Department of Environmental Quality
Net reduction of $18.3 million
O $4.2 million is non-recurring expenses related to the oil spill
Another $8.3 million is a budget adjustment based on a three-year average of actual expenses
O $2.5 million from annualizing the mid-year plan
o $1.9 million associated with the GEMS procurement initiative
o $1.07 million is from the elimination of 14 vacant full-time positions that have been vacant for over 12 months
Department of Natural Resources
$14.6 million net reduction
O $6.7 million reduction in budget authority
Consolidating Dallas field office with Houston -$350,000
Legal services decrease -$236,000
Office space consolidation -$300,000
O $2 million MOF swap to replace general fund with Mineral and Energy Operation fund
O GEMS -$712,410 for procurement initiative
O $3 million reduction associated with the consolidation of back office functions at DEQ, LWF and DNR
O $2.4 million in non-recurring funding
Department of Revenue
$18.9 million net reduction
•Annualizing the mid-year plan -$2.5 million
•Reducing dues and subscriptions -$200,000
•GEMS procurement initiative -$657,000
•$7.5 million in reduction of excess budget authority
•$12.8 million in non-recurring funding –judgment and federal grants, and carryforwards
Tax Credit Reform
•By converting some refundable tax credits to non-refundable, the state will reduce expenses by $526 million without raising taxes.
•The credits will remain available and will continue to offset tax liability.
•Inventory Tax Credit
•Wind and Solar
•Research and Development
•Ad Valorem for Offshore Vessels
•Musical and Theatrical
•Telephone Co Property Tax Credit
•Ad Valorem for Certain Natural Gas
•Vehicle Conversion to Alternative Fuel
•Sugarcane Trailer Conversion
•Historic Residential Rehab
Cost of Doing Business Adjustments
Over the past two decades, inflation and growth have increased the cost of doing business all over the country.
Adjusting some of the fees collected by state agencies to cover the increase in costs could generate $25-75 million for the state.