Louisiana state budget and finances

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Louisiana budget and finances
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General information
Budget calendar:
Annual
Fiscal year:
2015
State credit rating:
AA (as of 2014)
Current governor:
Bobby Jindal
Financial figures
Total spending (state and federal funds):
$28.8 billion (estimated for 2014)
Per capita spending:
$6,188.39 (estimated for 2014)
Total state tax collections:
$9.2 billion (2013)
Per capita tax collections:
$1,992.50 (2013)
State debt:
$83.3 billion (as of 2014)
Per capita state debt:
$18,097 (as of 2014)
State budgets and finances
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Total state expendituresState debtTax policy in Louisiana
Note: This page utilizes information from a variety of sources. As such, the currency of the information varies somewhat. The information presented on this page reflects the most recent data available as of February 2015.
Between fiscal years 2013 and 2014, total government spending in Louisiana increased by approximately $1.8 billion, from $26.9 billion in fiscal year 2013 to an estimated $28.8 billion in 2014. This represents a 6.8 percent increase. The cumulative rate of inflation during the same period was 1.58 percent, calculated using the Consumer Price Indices for January 2013 and January 2014. As of 2014, financial services firm Standard and Poor's had assigned Louisiana a credit rating of AA.[1][2][3]
In fiscal year 2014, total estimated spending in Louisiana amounted to $28.8 billion. In 2012 Louisiana ranked second in the nation for the percentage of its state budget comprised of federal aid, which stood at 44 percent of its budget.

Spending

Definitions

The information below comes from the National Association of State Budget Officers (NASBO). These spending figures are broken into three broad categories in order to facilitate comparison between the states.[3]

  • State funds: State funds include general and other state-based funds. A general fund is "the predominant fund for financing a state's operations." Other state funds are "restricted by law for particular governmental functions or activities."
  • Federal funds: Federal funds are "funds received directly from the federal government."
  • Total spending: Total spending is calculated by adding together the totals for state and federal funds.

These figures exclude spending from the sale of bonds.

2014 expenditures

See also: Total state expenditures

The table below breaks down estimated spending totals for fiscal year 2014 (comparable figures from surrounding states are included to provide additional context). Figures for all columns except "Population” and “Per capita spending" are rendered in millions of dollars (for example, $2,448 translates to $2,448,000,000). Figures in the columns labeled "Population” and “Per capita spending" have not been abbreviated.[3]

In Louisiana in fiscal year 2014, total estimated spending equaled $28.8 billion. Estimated per capita spending was $6,188.

Total estimated state spending, FY 2014 ($ in millions)
State State funds Federal funds Total spending Population Per capita spending
Louisiana $17,683 $11,091 $28,774 4,649,676 $6,188.39
Alabama $14,605 $9,288 $23,893 4,849,377 $4,927.02
Arkansas $16,077 $6,511 $22,588 2,966,369 $7,614.70
Mississippi $10,479 $8,197 $18,676 2,994,079 $6,237.64
Per capita figures are calculated by taking the state's total spending and dividing by the number of state residents according to United States Census estimates.[4]
Source: National Association of State Budget Officers

Spending by function

See also: State spending by function as a percent of total expenditures
Breakdown of spending by function in FY 2013
Source: National Association of State Budget Officers

State spending in Louisiana can be further broken down by function (elementary and secondary education, public assistance, etc.). Fiscal year 2013 information is included in the table below (information from neighboring states is provided for additional context). Figures are rendered as percentages, indicating the share of the total budget spent per category.[3]

In Louisiana in fiscal year 2013, higher education accounted for 10.3 percent of total state spending, a smaller share than in any neighboring state.

State spending by function as a percent of total expenditures, FY 2013
State K-12 education Higher education Public assistance Medicaid Corrections Trans-
portation
Other
Louisiana 19.3% 10.3% 0.5% 25.1% 3% 6.2% 35.7%
Alabama 20.4% 19.9% 0.2% 22.8% 2.4% 6.5% 27.7%
Arkansas 15.6% 15.4% 2% 21% 2.1% 5.8% 38%
Mississippi 16.4% 16.1% 5.9% 26.1% 2% 6.7% 26.7%
Source: National Association of State Budget Officers
Note: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Spending trends

Between 2009 and 2012, the share of the Louisiana state budget spent on Medicaid increased from 24 percent to 25.1 percent. See the table below for further details (figures are rendered as percentages, indicating the share of the total budget spent per category).[3][5][6][7][8]

Spending by function from 2009 to 2013 (as percentages)
Year K-12 education Higher education Public assistance Medicaid Corrections Transportation Other
2013 19.3% 10.3% 0.5% 25.1% 3% 6.2% 35.7%
2012 18.4% 9.9% 0.6% 26.7% 2.9% 7.1% 34.4%
2011 16.6% 7.5% 0.6% 22.1% 2.7% 6.9% 43.7%
2010 18.1% 8.0% 0.6% 23.7% 2.9% 10.9% 35.7%
2009 18.9% 10.6% 0.5% 24.0% 3.3% 6.7% 35.9%
Source: National Association of State Budget Officers
Note: "Other" expenditures include "Children's Health Insurance Program (CHIP), institutional and community care for the mentally ill and developmentally disabled, public health programs, employer contributions to pensions and health benefits, economic development, environmental projects, state police, parks and recreation, housing and general aid to local governments."[3]

Revenues

2013 revenues

See also: State government tax collections by source

The table below breaks down state government tax collections by source in 2013 (comparable figures from surrounding states are also provided to give additional context). Figures for all columns except "population" and "per capita revenue" are rendered in thousands of dollars (for example, $2,448 translates to $2,448,000). Figures in the columns labeled "population" and "per capita revenue" have not been abbreviated).[9]

Total tax collections in Louisiana in 2013 amounted to $9.2 billion. Per capita tax collections totaled $1,992.50.

State tax collections by source ($ in thousands)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes Total 2013 population Per capita collections
Louisiana $52,686 $4,974,642 $369,930 $2,739,983 $252,430 $834,158 $9,223,829 4,629,284 $1,992.50
Alabama $322,300 $4,707,375 $490,475 $3,202,520 $382,202 $161,597 $9,266,469 4,833,996 $1,916.94
Arkansas $1,022,066 $4,019,203 $356,920 $2,649,577 $402,874 $135,767 $8,586,407 2,958,765 $2,902.02
Mississippi $24,122 $4,571,294 $530,010 $1,755,424 $415,980 $105,895 $7,402,725 2,992,206 $2,474.00
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
Louisiana tax collections by source in 2013
Source: Tax Policy Center

The table below lists 2013 tax collections by source as percentages of total collections. In Louisiana, sales taxes and gross receipts accounted for approximately 54 percent of total tax collections.[9]

State tax collections by source (as percentages)
State Property taxes Sales and gross receipts Licenses Individual income taxes Corporation net income taxes Other taxes
Louisiana 0.57% 53.93% 4.01% 29.71% 2.74% 9.04%
Alabama 3.48% 50.80% 5.29% 34.56% 4.12% 1.74%
Arkansas 11.90% 46.81% 4.16% 30.86% 4.69% 1.58%
Mississippi 0.33% 61.75% 7.16% 23.71% 5.62% 1.43%
Source: Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014

Current fiscal year budget

See also: Historic Louisiana budget and finance information

Fiscal year 2015

DocumentIcon.jpg See budget bill: HB 1

Governor Bobby Jindal announced his fiscal year 2015 budget proposal on January 24, 2014. Under the governor's proposal, total state spending for fiscal year 2015 would have equaled approximately $25 billion, including $8.6 billion in general fund spending.[10]

On June 19, 2014, Jindal signed into law the fiscal year 2015 budget. The enacted budget totaled $25.1 billion. The budget included a $120 million increase in the K-12 education funding formula. The budget also included a merit pay increase for state workers.[10]

State debt

See also: State debt

According to a January 2014 report by the nonprofit organization State Budget Solutions, Louisiana had a state debt of approximately $83.3 billion. Its state debt per capita was $18,097. The report revealed that state governments faced a combined $5.1 trillion in debt. The obligation amounted to $16,178 per capita in the nation.[11]

Total state debt, 2014
State Total state debt State debt per capita Per capita debt ranking
Louisiana $83,280,815,000 $18,097 15
Alabama $68,343,597,000 $14,173 26
Arkansas $37,704,936,000 $12,785 33
Mississippi $54,686,815,000 $18,321 14
Sources: State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014

Public pensions

See also: Louisiana public pensions and Louisiana public employee salaries

A 2012 report from the Pew Center on the States noted that Louisiana's pension system was funded at 56 percent at the close of fiscal year 2010, well below the 80 percent funding level experts recommend. Consequently, Pew designated the state's pension system as cause for "serious concern."[12]

The funding ratio for the four state-sponsored pension systems decreased from 70.38 percent in fiscal year 2007 to 55.86 percent in fiscal year 2012, a decrease of 14.52 percentage points, or 20.6 percent. Likewise, unfunded liabilities increased from over $10.5 billion in fiscal year 2007 to nearly $20 billion in fiscal year 2012.[13][14][15][16][17][18][19][20][21][22][23][24][25][26]

Credit ratings

See also: State credit ratings

Credit rating agencies, such as Standard and Poor's, assign grades to states that take into account a state's ability to pay debts and the general health of the state's economy. Generally speaking, a higher credit rating indicates lower interest costs on the general obligation bonds states sometimes sell to investors in order to finance large-scale undertakings (e.g., road construction and other public works projects). This in turn results in lower interest costs, thereby lowering the cost to taxpayers.[27][28]

The table below lists the Standard and Poor's credit ratings for Louisiana and surrounding states from 2004 to 2014. Standard and Poor's grades range from AAA, the highest available, to BBB, the lowest.[29]

State credit ratings, 2004 to 2014
State 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004
Louisiana AA AA AA AA AA- AA- A+ A A A A+
Alabama AA AA AA AA AA AA AA AA AA AA AA
Arkansas AA AA AA AA AA AA AA AA AA AA AA
Mississippi AA AA AA AA AA AA AA AA AA AA AA
Source: Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014

Federal aid to state budget

See also: Federal aid to state budgets

State governments receive aid from the federal government to fund a variety of joint programs, such as Medicaid. Federal aid varies considerably from state to state. For example, Mississippi received approximately $7.7 billion in federal aid in 2012, which accounted for more than 45 percent of the state's general revenues. By contrast, Alaska received roughly $2.9 billion in federal aid in 2012, just under 20 percent of the state's general revenues.[30]

The table below notes what share of Louisiana’s general revenues came from the federal government in 2012. That year, Louisiana received approximately $11.1 billion in federal aid, 44 percent of the state's total general revenues. Figures from surrounding states are provided for additional context.[30]

Federal aid to state budgets, 2012
State Total federal aid ($ in thousands) Federal aid as a % of general revenue Ranking
Louisiana $11,136,334 43.96% 2
Alabama $8,112,509 36.50% 9
Arkansas $5,900,988 34.46% 21
Mississippi $7,725,294 45.35% 1
Source: United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014

Stimulus

Louisiana received $2.9 billion in federal funding between February 2009 and June 2013.[31]

Louisiana received approximately $540 million from the federal government in the summer of 2010 under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that President Barack Obama signed into law on August 10, 2010.[32]

Budget process

The state operates on an annual budget cycle. The sequence of key events in the budget process is as follows:[33][34]

  1. Budget instruction guidelines are sent to state agencies in September.
  2. State agencies submit their budget requests in November.
  3. Agency hearings are held in January and February.
  4. The governor submits his or her proposed budget to the state legislature 45 days prior to the regular session of the legislature (for a newly elected governor, this deadline is extended to 30 days prior to the regular session of the legislature).
  5. The legislature typically adopts a budget in June. A simple majority is required to pass a budget. The fiscal year begins July 1.

Louisiana is one of 44 states in which the governor has line item veto authority.[34]

The governor is legally required to submit a balanced budget proposal. Likewise, the legislature is legally required to adopt a balanced budget.[34]

Agencies, offices and committees

The following standing committees in the Louisiana State Legislature deal with budget and finance matters:[35][36]

  1. Appropriations Committee, Louisiana House of Representatives
  2. Ways and Means Committee, Louisiana House of Representatives
  3. Finance Committee, Louisiana State Senate
  4. Revenue & Fiscal Affairs Committee, Louisiana State Senate
  5. Joint Legislative Budget Committee, Louisiana State Legislature

The Louisiana Legislative Auditor is responsible for overseeing state and local government finances, financial audit, compliance audit, performance audit, advisory and recovery assistance services. The auditor is elected by members of the Louisiana State Legislature.[37]

Studies and reports

U.S. PIRG "Following the Money" report

See also: "Following the Money" report, 2014

The U.S. Public Interest Research Group, a consumer-focused nonprofit organization based in Washington, D.C., released its annual report on state transparency websites in April 2014. The report, entitled "Following the Money," measured how transparent and accountable state websites are with regard to state government spending.[38] According to the report, Louisiana received a grade of B+ and a numerical score of 88, indicating that Louisiana was an "advancing" state in terms of transparency regarding state spending.[38]

Budget and finance ballot measures

Voting on
state and local
government budgets,
spending and finance
State finance.jpg
Policy
Budget policy
Ballot measures
By state
By year
Not on ballot
See also: Spending and finance on the ballot and List of Louisiana ballot measures

Ballotpedia has tracked the following ballot measures relating to state and local budget and financial matters in Louisiana.

  1. Louisiana Appropriations for Education, Amendment 7 (Oct 1999)
  2. Louisiana Artificial Reef Development Fund Protection, Amendment 8 (2014)
  3. Louisiana Biennial Budget Cycle, Amendment 3 ( Oct 1999)
  4. Louisiana Budget Estimate to Fund Law Enforcement, Amendment 6 (2002)
  5. Louisiana Budget Stabilization Fund, Amendment 4 (October 2011)
  6. Louisiana Creates Oil Spill Contingency Fund, Amendment 12 (October 1995)
  7. Louisiana Creates Oilfield Site Restoration Fund, Amendment 11 (October 1995)
  8. Louisiana Limit Administrative Spending, Amendment 3 (October 1990)
  9. Louisiana Medicaid Trust Fund, Amendment 1 (2012)
  10. Louisiana Mineral Revenue Trust Fund, Amendment 2 (October 1990)
  11. Louisiana Patient's Compensation Fund, Amendment 3 (October 2011)
  12. Louisiana Permanent Trust Fund, Amendment 1 (October 1994)
  13. Louisiana Police Salaries, Amendment 4 (Oct 1999)
  14. Louisiana Public Retirement System, Amendment 2 (October 2011)
  15. Louisiana Retirement Fund Investment, Amendment 7 (2008)
  16. Louisiana Separate State Budgets, Amendment 5 (October 1995)
  17. Louisiana TOPS Scholarship Program, Amendment 1 (October 2011)

Recent news

This section displays the most recent stories in a Google news search for the terms "Louisiana budget."

Some of the stories below may not be relevant to this page due to the nature of Google's news search engine.

Louisiana state budget and finances - Google News Feed

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Contact information

Louisiana Division of Administration
1201 N. Third Street, Suite 7-150
Baton Rouge, Louisiana 70804
Telephone: 225-342-7005

See also

External links

Additional reading

References

  1. Bureau of Labor Statistics, "CPI Detailed Report Data for February 2014," accessed April 9, 2014
  2. InflationData.com, "Cumulative Inflation Calculator," February 28, 2014
  3. 3.0 3.1 3.2 3.3 3.4 3.5 3.6 National Association of State Budget Officers, "State Expenditure Report: 2012-2014," accessed February 18, 2015
  4. United States Census Bureau, "State and County QuickFacts," accessed February 23, 2014
  5. National Association of State Budget Officers, "State Expenditure Report, 2009-2011," accessed February 24, 2014
  6. National Association of State Budget Officers, "State Expenditures Report, 2010-2012," accessed February 24, 2014
  7. National Association of State Budget Officers, "State Expenditure Report, 2009," accessed February 24, 2014
  8. National Association of State Budget Officers, "State Expenditure Report, 2008," accessed February 24, 2014
  9. 9.0 9.1 Tax Policy Center, "State Tax Collection Sources 2000-2013," June 20, 2014
  10. 10.0 10.1 National Association of State Budget Officers, "Summaries of Fiscal Year 2015 Proposed and Enacted Budgets," July 11, 2014
  11. State Budget Solutions, "State Budget Solutions' Fourth Annual State Debt Report," January 8, 2014
  12. Pew Center on the States, "Widening Gap Update: Louisiana," June 18, 2012
  13. Louisiana State Employees' Retirement System, "2011-2012 Comprehensive Annual Financial Report," accessed November 12, 2013
  14. Teachers' Retirement System of Louisiana, "Comprehensive Annual Financial Report 2012," accessed November 12, 2013
  15. State of Louisiana School Employees' Retirement System, "Annual Financial Report June 30, 2012 and 2011," accessed November 12, 2013
  16. Louisiana State Police Pension and Retirement System, "Annual Report, June 30, 2012," accessed November 12, 2013
  17. Firefighters' Retirement System, "2012 Consolidated Financial Report," accessed November 12, 2013
  18. Municipal Employees' Retirement System of Louisiana, "Audit Report, June 30, 2012 and 2011," accessed November 12, 2013
  19. Parochial Employees' Retirement System of Louisiana, "Annual Financial Report, December 31, 2012 and 2011," accessed November 12, 2013
  20. Sheriffs Pension and Relief Fund, "Actuarial Valuation as of June 30, 2012," accessed November 12, 2013
  21. District Attorneys' Retirement System, "Actuarial Valuation as of June 30, 2012," accessed November 12, 2013
  22. Louisiana Assessors' Retirement Fund, "Actuarial Valuation as of September 30, 2012," accessed November 12, 2013
  23. Clerks' of Court Retirement and Relief Fund, "Actuarial Valuation as of June 30, 2012," accessed November 12, 2013
  24. Harbor Police Retirement System, "Actuarial Valuation as of June 30, 2010," accessed November 12, 2013
  25. Registrar of Voters' Employees' Retirement System, "2012 Audit Report," accessed November 12, 2013
  26. Municipal Police Employees' Retirement System and Subsidiaries, "2012 Audit Report," accessed November 12, 2013
  27. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2012," July 13, 2012
  28. Bankrate, "The 6 states with the worst credit ratings," September 27, 2012
  29. Stateline: The Daily News Service of The Pew Charitable Trusts, "Infographic: S&P State Credit Ratings, 2001-2014," June 9, 2014
  30. 30.0 30.1 United States Census Bureau, "State Government Finances: 2012," accessed February 24, 2014
  31. Recovery.gov, "Stimulus Spending by State," accessed February 21, 2014
  32. Federal Fund Information for States, “ARRA FMAP Extension and Education Jobs Fund Totals,” August 11, 2010
  33. National Conference of State Legislatures "State Experiences with Annual and Biennial Budgeting," updated April 2011
  34. 34.0 34.1 34.2 National Association of State Budget Officers "Budget Processes in the States, Summer 2008," accessed February 21, 2014
  35. Louisiana State Senate, "Committees," accessed March 19, 2015
  36. Louisiana House of Representatives, "House Standing Committees," accessed March 19, 2015
  37. Louisiana Legislative Auditor, "About," accessed March 12, 2015
  38. 38.0 38.1 U.S. Public Interest Research Group, "Following the Money 2014 Report," accessed April 15, 2014