House panel votes to cut $184M from state contracts and shift money to TOPS

Republican lawmakers, eying spending cuts to shift money to fully fund TOPS, the state’s college scholarship program for in-state students, pushed through committee approval Monday to require the executive branch to cut $184 million from state contracts.
Rep. Jerome Richard, I-Thibodaux, presented to the House Appropriations Committee his annual bill, this time House Bill 74, that looks to cut 10 percent of state spending for all professional, personal and consulting service contracts. However, the committee voted 15-5 to cut the contracts by the precise amount the governor’s budget reduced TOPS.
“If a contract is not needed, let’s get rid of it, and save TOPS,” Richard said. “Let’s put money where our mouth is and cut some contracts.”
Division of Administration (DOA) officials testified that the state has nearly 3,000 professional, personal and consulting contracts that cost the state’s general fund $5.5 billion. A majority of those funds go to contracts with Bayou Health and the Office of Group Benefits, programs that help elderly and lower-income residents.
Jonathan Walker, an assistant director at the Office of State Procurement at the Division of Administration, said if lawmakers do not cut contracts with Bayou Health and the Office of Group Benefits, only $400 million in state discretionary funds for contracts are qualified for cuts.
The $184 million cut would equate to a 46 percent reduction to those contracts.
During the hearing, Rep. Cameron Henry, R-Metairie, indicated Bayou Health was not safe from the chopping block just because of past precedent.
“We are slowly witling down our options because that is the way we used to do things. We’re going to have to think differently to solve our problems.”
Henry later told Manship School News Service that TOPS was one of the top priorities for House members, and that the Legislature must ensure that any money cut from contracts would be available for students entering college in the fall of 2017.
Scott Johnson, general counsel for the DOA, clarified that cuts to government contracts do not equate to a dollar for dollar match because most agreements with private entities have termination costs the state would have to cover.
Johnson and Walker emphasized that finding $184 million in cuts to contracts would be difficult for the DOA, but not impossible.