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article imageLouisiana’s construction budget goes over by $400m

By Simon Crompton     Jun 3, 2014 in Politics
On Sunday, a Senate committee bloated the state construction budget with more projects.
Going over budget by $400 million, House Bill 2 is now in the hands of Gov. Bobby Jindal who needs to decide on which projects stay and which go.
Quickly advancing it to the full Senate after appending 67 pages of amendments, the Senate Committee on Revenue and Fiscal Affairs may have known what they were doing by speedily sending the bill through for a vote.
The bill, also known at the “capital outlay bill,” includes federal highway money and other funding sources that are set aside for state construction projects.
Initially, the $3.4 billion budget — which outlines projects that span several years — was already overcommitted by $34 million. The move by the Revenue and Fiscal Affairs Committee sent it over the top with an extra $400 million in expenditures.
Prior to the Senate additions, Jindal’s administration had proposed a list of projects for the budget along with $120 million more in expenditures, then submitted it to lawmakers.
The House proceeded to rework his recommendations, removing several of Jindal’s proposals and ultimately leaving the bill overcommitted by just $20 million.
What comes into question is the vast amounts of funding that have been collected over the past 20 years through tax-exempt bond programs slated for state infrastructure improvements. Louisiana has accumulated at least $70 million, and possibly over $100 million, in bonds which should be used for construction projects.
Plans are to use at least $70 million, which needs to be used within IRS-mandated time periods, which Louisiana has failed to do.
The state of Louisiana is capped at borrowing $355 million annually for construction projects this fiscal year.
Projects added by the Senate committee include: $6 million to improve the Mercedes-Benz Superdome, $3.5 million to conduct a study of the New Orleans airport and $1 million to renovate the A.O. Williams Hall at Baton Rouge’s Southern University.
The House can either accept the Senate add-ons or send the budget bill to a six-member legislative committee to work out a final version. The legislative session must end by Monday.
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