Jindal impresses on outlay reform, but challenges remain

Gov. Bobby Jindal’s declaration that the capital projects he wants the state to pursue are only those approved in prior years and constitute nothing new casts optimism and uncertainty into the reform process.

Under the current process, far more items are stuffed into the capital outlay budget each year than constitutionally the state can spend money on. The items that pass muster really emanate from the governor’s office when the State Bond Commission is brought spending proposals and then approves, a body lined with gubernatorial allies. As a result, roughly three-quarters of authorized spending annually lies on the table where, maybe, in future years it might actually get funded.

Jindal has said for this year’s round, he’s going to take previous years’ choices and not introduce anything new. He can say legitimately that he is not ignoring any new broad needs because the state spent over a half billion dollars last month in a special session on such needs.

Impressively, Jindal also issued an executive order with new guidelines to determine spending priorities. A more formal ranking system would be imposed, and anything local would have to have some commitment from local governments. Jindal also backs reform bills that would stop the state from making future commitments that do not have a scheduled appropriation attached to them.

This sets the state up well for reform of the process, but questions remain. For one, until the process reform becomes law, nothing stops the Legislature from doing the same thing again, loading up this years capital outlay bill with three times the authorized amount – except for a committed governor, willing to use a line item veto on items that he thinks will bust that budget and, most importantly, telling legislators he will do that.

Also, the interim procedures established in the executive remain hostage to politics. The Jindal Administration still will have to choose if all goes well, just one out of three dollars instead of one out of four, and make sure these are the best choices. And the Legislature will have to be sufficiently under control not to pass instruments overriding the executive order.

Most importantly, Jindal’s crew must choose wisely. It’s assumed the order’s standards will be used, and Jindal must resist political ploys to bend them. Finally, even if the reform bill gets through and moots much of this interim strategy in the future, nothing about this addresses the nagging problem of earmarks that appear in the general appropriations bill, where only stern threatened use of a line item veto can rid it of projects that almost uniformally are of very low priority and really do not help the state as a whole.

Especially the executive order ratifies Jindal’s pledge of reform of state spending priorities. Now he needs to follow through by getting the reform bill into law and holding fast threatening, even using, his veto power, despite the political challenges no doubt coming his way.