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Gov. Jindal uses fund sweeps to plug most of state deficit, combined with contract, job cuts

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BATON ROUGE, Louisiana — Gov. Bobby Jindal's administration will use $130 million in patchwork financing from a tax amnesty program, insurance settlement, uninsured motorist penalties and other excess funds to close most of the state's midyear budget deficit, under a plan unveiled to lawmakers Friday.

The money combined with $50 million in state agency cuts will rebalance the $25 billion budget for the fiscal year that ends June 30. Public colleges were shielded from slashing.

"This approach has probably mitigated major cuts to health care and higher education. I'm pleased with it," said Rep. Jim Fannin, R-Jonesboro, chairman of the Joint Legislative Committee on the Budget.

Commissioner of Administration Kristy Nichols, the governor's chief budget adviser, said the plan balances the budget "without jeopardizing critical services."

Most of the hits to agencies come from not filling vacant jobs, reducing contracts and spending fewer dollars for travel and supplies. The state will lessen spending on supplies for road maintenance work, public school testing contracts and mentor programs for at-risk youth.

Nearly $4 million will be saved because Louisiana's voucher program that sends students to private schools with taxpayer dollars had 700 fewer students than expected. Health care contracts at state prisons will shrink.

While the health department accounts for more than a third of the state's total budget, it received only a $5 million cut. Start dates for some of its contracts will be delayed, travel and supply purchases will be reduced, and jobs won't be filled.

"I do feel like these are reductions that we can take without affecting services to people," Health and Hospitals Secretary Kathy Kliebert said.

Among the health care cuts, criteria will be changed for the Pediatric Day Health Care Program, which provides nursing care, physical therapy and education services to children with severe medical conditions. Fewer children will be eligible for the program. Kliebert said the state can provide the services at a cheaper cost through other available programs at schools and day care facilities that have less restrictive environments.

Across state agencies, 167 jobs will be eliminated while at least 88 more won't be filled for the remainder of this year.

Louisiana's income estimating panel dropped the revenue forecast last week because of slumping severance tax and mineral royalties from dropping oil prices, combined with weak growth in personal income taxes.

Nichols said the state could offset nearly three-quarters of the $180 million shortfall presented to lawmakers with unspent dollars from: a recent tax amnesty program, an insurance settlement from Hurricane Gustav, dollars from recent state property sales and unspent revenue sitting in several state funds.

Lawmakers will vote on the plan next month, though Fannin said he didn't expect resistance for most of the ideas.

Sen. Francis Thompson, D-Delhi, asked for reconsideration of vacant job cuts in the agriculture department, and Rep. Jim Morris, R-Oil City, wanted more details about $2 million in reductions to supplies for road maintenance.

"When you live 300 miles from here, like I do, roads are a critical service," he said.

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