Capital outlay reform may come at cost of bad priorities

It’s good to see that Louisiana elected officials concur with my assessment about an unglamorous, but very necessary reform of its capital budgeting process. Several, almost identical, bills have been introduced for the regular session to do so, but it’s the almost imperceptible differences that will make for interesting confrontations, may signal a transformation of power relations in state government, and could test the Gov. Bobby Jindal Administration’s views on the role of the governor and Legislature and in policy.

In brief, the current process allows for many more projects than for which funding exists for them, because it allows legislators to claim they got goodies for their districts into the capital outlay budget and can blame the governor for not letting them through if they don’t get funding. This is because the governor may veto a very few, but if that doesn’t bring down the overall spending to the authorized spending, the administration working with the State Bond Commission technically decides what gets funded, with a majority of the composition of the latter normally controlled by the governor.

So the administration has three areas in which it may, in essence, veto requests. But it also has a way to forward requests, because the process by law begins with requests from the administration in the enabling legislation. Legislators then add to it but generally do not reject the governor’s initial requests. What is eventually decided on for funding gets money, and everything else goes back into limbo in part or in whole subject to the whims of the next annual capital budget process.

Bills HB 582, by House Speaker Jim Tucker, and SB 1, by state Sen. Robert Adley, among others seek to change this process so that enough gets funded for one year, and other items that miss the cut legally get put into a waiting list of one to four years, or perhaps could be funded in the present year if there’s a combination of gubernatorial line item vetoes or disapproval of the Commission. Tucker, of course, is a Jindal ally and floor leader, so we can assume his bill pasts muster with the administration.

Adley has been trying to get a version of his bill through for a couple of years now and when asked about it, Jindal’s lead official in his administration Commissioner of Administration Angéle Davis said “I think there are some components in Adley's bill that make sense,” she demonstrated an incredible mastery of understatement, for the bills are virtually identical in wording and differ in only one major respect: Adley’s is a constitutional amendment while Tucker’s is statutory.

In both cases, a funding plan must be established for all periods which would be binding, thereby limiting the governor’s choices without legislative intervention to pick and choose. However, it goes into effect only after this session.

Jindal’s apparent acquiescence shows he is willing to put his money where his mouth is in terms of reform. Whether legislators will go along with it is another matter and it may all come down to a fight over the official current capital priorities. Under present law, Jindal can change these by Apr. 7 and part of the deal may be to keep largely intact old priorities (already approved by reelected legislators and benefiting their districts) in order to get their support on the new process. (This implies Tucker’s approach, requiring only a simple majority, may work better than Adley’s, needing two-thirds votes and then citizen approval.)

This could lead to an interesting battle, given that the priorities under previous Gov. Kathleen Blanco leave something to be desired, such as an over-built new charity hospital for New Orleans. It may create a bad situation for Jindal aiming for reform but having to countenance bad policy to achieve it.