A Message from the President
June 14, 2010 - Legislative and Budget Update
As the current session of the Louisiana Legislature begins its final week, winding down to the mandatory adjournment next Monday, June 21, at 6:00 p.m., a number of critical budget issues remain unresolved.
This past Friday, the Revenue Estimating Conference met to consider updated revenue forecasts which suggest the budget deficit for the current fiscal year is over $260 million greater than previously recognized. Although the Conference stopped short of officially recognizing the larger budget shortfall, it seems clear that this development further complicates an already challenging financial situation for our State.
The State budget for next fiscal year, which begins July 1, was passed out of the House of Representatives on June 4, with an additional $50 million in cuts to higher education. The budget is now being considered by the Senate Finance Committee. Although there appeared to be some sentiment on the Senate side to look for ways to mitigate the additional reductions to higher education, it is unclear what the effect of the news from the Revenue Estimating Conference will have on this sentiment.
After being significantly amended in both the House Education Committee and House Appropriations Committee, the LA GRAD Act, was adopted by the House of Representatives. This Bill would allow higher education institutions to raise tuition in exchange for meeting performance goals. The Bill was further amended by the Senate Education Committee last week. In my opinion, the amendments made in Senate Education place the Bill in a much more realistic and positive posture. If approved by the full Senate, the Bill will require House concurrence. Obviously, this is an important Bill for higher education.
A House Concurrent Resolution urging the Board of Regents to suspend implementation while further studying the new funding formula has been adopted in both the House and Senate. The Resolution does not carry the weight of law. However, it is a positive development in light of concerns regarding the formula, its limitations and complications resulting from implementation during a time of severe budget distress. Several members of our legislative delegation played key roles in co-authoring and supporting the Resolution. I testified at the Senate Finance Committee meeting last Thursday to provide information about the challenges associated with implementation of the new formula given current budget circumstances.
While additional budget reductions for higher education next year appear likely, what remains uncertain is the amount. I believe it is prudent that we continue on the current course to further reduce our operating costs. As part of these efforts, a number of program reductions and personnel actions will be announced in the weeks ahead.
As always, I will keep the campus informed of any significant additional developments.
Thank you.
John Crain