Budget Basics


Budget Basics

Louisiana is facing a $1.1 billion shortfall when temporary revenues expire in summer 2018. It might surprise you to learn that $1.1 billion would be such a big problem for a state budget that totals over $32 billion per year. 

In reality, the $1.1 billion has to come from a very small piece of the pie: discretionary money in the State General Fund, which is just over $3.4 billion. This is the area of our state budget that makes up the majority of our funding for critical health care programs, higher education including TOPS, and other important expenditures. 


So what is the rest of the money being spent on? Can't we just free it up to cover our other costs? 

Unfortunately, it's not that easy.

  • 56 percent of non-discretionary SGF goes to local K-12 schools per the Louisiana Constitution.

  • Other funding for things like public safety and health and human services are dedicated due to federal mandates and court orders.

  • Certain obligations like debt service, insurance and retiree benefits and incarceration are “unavoidable."

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Which leads to the unavoidable conclusion. Louisiana is at a critical moment. Our budget cannot sustain a $1.1 billion cut from $3.4 billion. It would be a devastating cut to the discretionary funds in the State General Fund that are currently paying for higher education and critical health care services. Revenue is the solution. 

To learn more about the fiscal cliff Louisiana faces, visit our page "about the cliff."