Governor preps for potential bailout

BATON ROUGE – Louisiana could get another round of multi-million dollar budget relief from Washington, and even as Gov. Bobby Jindal complains about federal spending, he outlined plans for using the extra aid if it comes.The proposal under discussion by Congress would extend by six months a boost in federal Medicaid money for states that was included in the stimulus bill. That would give Louisiana another $428 million for health services, according to estimates from the Jindal administration.

More than 40 governors from both parties sent a letter to Democratic and Republican leaders in Congress, asking them to approve the aid for their cash-strapped states. Jindal, a Republican guarding his national profile, wouldn’t sign the letter, as he continues to complain about federal stimulus cash even as he uses it to bail out Louisiana’s budget.

About $1 billion of stimulus money is propping up this year’s state budget, paying for agency operating expenses, public colleges, education programs and health care services. Jindal proposes using another $1 billion in stimulus in the fiscal year that begins July 1.

While Jindal wouldn’t request the Medicaid money, he has a proposal for spending those dollars if they’re approved.

If the federal relief comes through, Jindal said he wants state lawmakers to replace two pools of one-time income that he used in his budget recommendations to fill gaps and stop some budget cuts: $234 million from a tax amnesty program and $76 million in state surplus cash.

Those amnesty and surplus dollars could then be used a year later when the state’s financial problems worsen with the loss of stimulus money.
Jindal was asked last week why he wouldn’t sign the letter requesting the Medicaid money even though he’d use the cash.

The governor replied that a two-quarter extension of the Medicaid stimulus relief was only a “Band-Aid” that wouldn’t permanently help states.