The Revenue Estimating Conference released surplus amounts for the current budget year and the next for Louisiana. Commissioner of Administration Jay Dardenne said the state has a surplus of $925 million for the current year budget that ends June 30th.
“That’s a lot of money and it really is in recognition of the fact that we had budgeted conservatively, and the economy continues to perform well, so the budget was increased by that amount,” said Dardenne.
And the forecasted surplus for next year’s budget that begins July 1st is $608 million.
Dardenne said the REC will give recommendations to the legislature on how the extra funds should be spent when the executive budget is presented in February. He said those recommendations will be consistent with what was done in the current year and use some of the recurring money for nonrecurring purposes.
“So, in other words, use it on one-time expenditures it will give us a chance to improve infrastructure and make the kind of investments we need to make, while at the same time we’re not growing the budget,” said Dardenne.
Dardenne also suggested using the funds for teacher pay raises in next year’s budget.
Insurance Commissioner Jim Donelon has stated he will ask the REC for a portion of those funds in an effort to entice more property insurers to write policies in Louisiana. At least 10 insurers left the state and of those who remain, several of them are not writing any new policies in Louisiana. Dardenne said Donelon discuss a plan at the REC Thursday.
“What he indicated to us is that he’s going to ask the legislature to identify about $45 million in funding that could be made available to try to incentivize insurance companies to write in the state,” said Dardenne.
Dardenne also said the state is expected to face a budget shortfall in 2025 because a .45-percent sales tax will expire.
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