House adjusts capital outlay projects

The House voted 80-14 Friday to reprioritize more than a billion dollars in capital outlay projects after a presentation by Ways and Means Committee Chairman Neil Abramson, D-New Orleans, showed the state does not have anywhere near the money to handle the projects on its current plate.
Abramson said legislators were so caught up in discussions about the omnibus operating budget bill House Bill 1 that they have not paid enough attention to the much larger issues present in the capital outlay budget, represented in House Bill 2.
The bill now goes to the Senate where members expect numerous changes.
He called out the state bond commission for approving $1.2 billion in capital outlay projects, noting the state has only $312 million in cash to pay for the projects and can only borrow $435 million over the next two years. That would leave the contractors doing the work holding the bag for $765 million.
“In June that $300 million will be gone,” Abramson said. He noted the state will hit its borrowing limit soon and will be unable to obtain further loans until July 1, 2018. Even then, he warned, the state will only be able to borrow $180 million.
Abramson took flak from Gov. John Bel Edwards Monday for not keeping his administration in the loop about hundreds of amendments to House Bill 2 that eliminated or reduced promised projects. Abrahamson explained the “general methodology” by which the committee reshuffled the money thus:
“The dollar figure in HB2 is not a real dollar figure, it’s an IOU. You can put all the (Priority 1) funding you want on there, it doesn’t mean you get your project.”
The committee prioritized funding for projects already underway, he said, since it would be a waste of resources to let those fall by the wayside. Because of that, he said, some areas of the state would be more affected than others.
Indeed, Rep. Dorothy Sue Hill, D-Dry Creek, told other House members who still had a project going to consider themselves lucky. She noted her home parish (Allen) had no projects even considered.
Rep. Walt Leger, D-New Orleans, raised concerns about the new projects added to the bill, asking about an Ochsner project and a Southern University project in particular.
Abramson explained the committee met with agencies and local groups to consolidate projects if those groups thought that was more important for the area. That means multiple projects lost their priority funding in lieu of another, that may be “new,” because representatives prioritized it, he explained.
Rep. John Schroder, R-Covington, was concerned about controlling how much money gets approved for these projects so the state doesn’t run into the problems in the future.