§75. Avoidance of budget deficits

A.(1) The division of administration shall submit a budget status report monthly to the Joint Legislative Committee on the Budget in a format approved by the committee. This report shall indicate the balance of the budget for the state general fund and dedicated funds by comparing the official forecast for these funds to the total authorized appropriations from each fund. The committee shall review the report and make any changes it deems appropriate to ensure that the report reflects the status of the budget for each fund as of the date on the report. The most recently approved budget status report shall be the official budget status of the state.

(2) The budget status report presented at the first meeting of the Joint Legislative Committee on the Budget after October fifteenth of any fiscal year shall reflect the balance in any fund for the previous fiscal year.

(3)(a) At the first meeting of the Joint Legislative Committee on the Budget after publication of the Comprehensive Annual Financial Report for the state of Louisiana, the commissioner of administration shall certify to the committee the actual expenditures paid by warrant or transfer and the actual monies received and any monies or balances carried forward for any fund at the close of the previous fiscal year which shall be reflected in the budget status report.

(b) At the first meeting of the Joint Legislative Committee on the Budget after publication of the Comprehensive Annual Financial Report for the state of Louisiana, the commissioner of administration and the legislative auditor shall present the report to the committee.

(4) The budget status report shall include a section describing any issues which materially affect the budgetary soundness of the state but which are not required to be fully addressed during the current fiscal year. The division of administration, after consultation with the Legislative Fiscal Office, shall prepare a description of each such issue. The description of such issues shall be submitted to the Legislative Fiscal Office at least one week prior to each meeting of the Joint Legislative Committee on the Budget.

B. If the budget status report indicates that the total appropriation from any fund will exceed the official forecast for that fund, the Joint Legislative Committee on the Budget shall immediately notify the governor that a projected deficit exists for that fund.

C. Upon receiving notification that a projected deficit exists, the governor shall have interim budget balancing powers to adjust the budget in accordance with the following provisions:

(1)(a) The governor may direct the commissioner of administration to reduce appropriations for the executive branch of government for any program that is appropriated from a fund that is in a deficit posture. Except as provided in Paragraph (2) of this Subsection, total adjustments for a budget unit shall not exceed three percent in the aggregate of the total appropriation for that budget unit for a fiscal year.

(b) The governor may direct the commissioner of administration to reduce appropriations for the Minimum Foundation Program either by using means provided in the act containing the appropriation only after having obtained written approval of two-thirds of the members of each house of the legislature in accordance with the procedures provided in R.S. 39:87, or by the procedure authorized in Paragraph (2) of this Subsection.

(c) The governor may direct the commissioner of administration to reduce appropriations for funding of elementary and secondary schools operated by Louisiana State University and Agricultural and Mechanical College and by Southern University and Agricultural and Mechanical College, or for any charter school, either pursuant to the procedure authorized in Paragraph (2) of this Subsection, or as provided by R.S. 17:3995(A)(2) only after having obtained the approval of the Joint Legislative Committee on the Budget.

(2)(a) In the event the governor has reduced state general fund allocations or appropriations by an aggregate amount equal to at least seven-tenths of one percent of the total of such allocations and appropriations for that fiscal year and a deficit still exists, the governor may make further budget adjustments in order to eliminate the deficit.

(b) In accordance with Article VII, Section 10(F) of the Constitution of Louisiana, the governor may direct the commissioner of administration to reduce any appropriation or allocation for the executive branch of state government from the state general fund and dedicated funds, including any which are constitutionally protected or mandated, by an amount not to exceed five percent in the aggregate of the total amount appropriated or allocated from that fund for that fiscal year.

(c) For the purposes of this Paragraph, reductions to appropriations and expenditures required by Article VIII, Section 13(B) of the Constitution of Louisiana shall not exceed one percent, and such reductions shall not be applicable to instructional activities.

(d) For the purposes of this Paragraph, the total dollar amount of reductions to appropriations from the Louisiana Quality Education Support Fund shall be apportioned equally between the appropriations for the Board of Regents and the State Board of Elementary and Secondary Education.

(e) Budget adjustments authorized by this Paragraph shall require the prior approval of the Joint Legislative Committee on the Budget. The state treasurer shall transfer and credit to any fund in deficit monies which become available as a consequence of the budget adjustments authorized by this Paragraph, but in no event shall such transfers exceed the amount of the deficit. Monies transferred as a result of such budget adjustments are deemed available for appropriation and expenditure in the year of the transfer from one fund to another.

(3) The governor may issue executive orders in the form of freeze orders prohibiting the expenditure of monies for specific items. The total dollar savings estimated to be achieved in the deficit fund or funds and any other fund as a result of a freeze order shall be deducted from appropriations in the budget status report.

(4) The governor may propose the use of an alternative source of revenue of a designated amount to address the deficit situation which shall be incorporated into the budget status report only after having obtained written approval of two-thirds of the members of each house of the legislature in accordance with R.S. 39:87.

D. If within thirty days of the determination that a projected deficit exists in a fund the necessary adjustments in the appropriations are not made to eliminate the projected deficit, the governor shall call a special session of the legislature for this purpose unless the legislature is in regular session. This special session shall commence as soon as possible as allowed by the provisions of the Constitution of Louisiana, including but not limited to Article III, Section 2(B).

E. If the official forecast of recurring money for the next fiscal year is at least one percent less than the official forecast of recurring money for the current fiscal year, the governor and the legislature may employ the following methods and procedures in the development of the state budget for the next fiscal year pursuant to authority granted in Article VII, Section 10(F) of the Constitution of Louisiana, for the purpose of avoiding a budget deficit in the next fiscal year.

(1) An amount not to exceed five percent of the total appropriation or allocation in the current fiscal year from any fund shall be available for appropriation in the next fiscal year for a purpose other than as specifically authorized for that fund.

(2) An amount not to exceed five percent of the current fiscal year's total appropriation or allocation for any expenditure which is either protected or mandated by law or the Constitution of Louisiana shall be available for appropriation in the next fiscal year for a purpose other than as specifically required by law or constitution. For the purposes of this Paragraph, an amount not to exceed one percent of the current fiscal year's total appropriation for expenditures required by Article VIII, Section 13(B) of the Constitution of Louisiana shall be available for other purposes.

(3) Monies made available as authorized under this Subsection may be transferred to a fund for which revenues have been forecast to be less than the revenues in the current fiscal year for such fund. In no event shall the aggregate amount made available in the next fiscal year for other purposes as provided in Paragraphs (1) and (2) of this Subsection exceed the amount of the difference between the official forecast for the current fiscal year and the next fiscal year.

(4) For the purposes of this Subsection, in the event that monies are transferred from the Louisiana Quality Education Support Fund, the total dollar amount of any resulting reductions in appropriations from that fund shall be apportioned equally between the appropriations for the Board of Regents and the State Board of Elementary and Secondary Education.

F. Repealed by Acts 2009, No. 479, §1, effective July 10, 2009.

Acts 1989, No. 836, §1, eff. July 1, 1989; Acts 1995, No. 631, §1, eff. June 20, 1995; Acts 1995, No. 919, §1, eff. June 28, 1995; Acts 1995, No. 1263, §1; Acts 1997, No. 477, §2, eff. June 30, 1997; Acts 1997, No. 1149, §1, eff. June 1, 1997; Acts 2001, No. 995, §1, eff. June 27, 2001; Acts 2001, No. 1063, §1, eff. Dec. 11, 2002*; Acts 2001, No. 1092, §1, eff. July 1, 2001; Acts 2002, 1st Ex. Sess., No. 107, §1, eff. April 18, 2002; Acts 2003, No. 922, §1, eff. July 1, 2003; Acts 2009, No. 479, §1, eff. July 10, 2009.