Judge decides Louisiana’s ‘rainy day’ fund dispute
Written By
Associated Press
BATON ROUGE — Louisiana’s lawmakers won’t be forced to refill the state “rainy day” fund to its cap, a state district judge ruled Monday, preventing a new budget shortfall that could have topped $150 million.
At issue was whether lawmakers needed to refill the Budget Stabilization Fund after using it two years ago.
Former state lawmaker Ron Gomez and local tea party leader Bob Reid claimed legislators violated the state Constitution by not replenishing the rainy day fund after tapping it to help close a deficit in the 2009-10 fiscal year.
The Legislature and Gov. Bobby Jindal administration’s argued that a more recent statute postponed any need to put money back into the fund. Baton Rouge-based District Judge Kay Bates said that Gomez and Reid didn’t prove the statute was unconstitutional, and she ruled in favor of lawmakers.
If Bates had sided with the plaintiffs, the decision would have required the movement of between $150 million and nearly $200 million in oil and gas revenue to the rainy day fund, depending on the existing balance in the fund. That money is planned for use in the state’s $25 billion general operating budget, so the move would have caused a hole in the budget in whichever year it would be required.
“Certainly, the case will be appealed as soon as possible,” said lawyer Kyle Keegan, who represents Gomez and Reid.
The House and Senate haggled over the repayment issue when they tapped into the rainy day fund to craft budget plans. Senate leaders, backed by Jindal, won the dispute.
Rather than oil and gas money flowing into the fund as provided by the constitution, Senate leaders argued that a 2009 statute didn’t require the fund to be filled until state revenue reaches the level of the 2007-08 fiscal year, a high-water mark in state income that won’t be reached for years. Jindal and a majority of House members agreed to Senate budget plans that didn’t require the rainy day fund to be refilled.
Keegan said the 2009 statute violated the rainy day fund mandates included in the constitution by suspending the oil and gas funding stream indefinitely.
Patricia Wilton, an assistant attorney general representing the state, said the constitution doesn’t spell out the timing of deposits into the rainy day fund and so the Legislature is able to enact a law determining how the payments should be made into the fund.
