04:21 PM CDT on Monday, September 19, 2005

Melinda Deslatte / Associated Press

BATON ROUGE -- Three weeks after Hurricane Katrina ravaged southeastern Louisiana, Gov. Kathleen Blanco hasn't formally required any state agencies to limit spending and focus on essential needs only, including the rebuilding and recovery.

The governor told lawmakers in a special meeting last week that she was issuing an executive order to rein in unnecessary spending, but by Monday the order still was being written and agencies were left to determine whether they wanted to cut back on travel, equipment purchases and other items to respond to Katrina.

"They've been working on it. It's not ready right now," Blanco spokeswoman Denise Bottcher said.

The governor's Division of Administration said the order likely would be out Tuesday.

Some agencies have instituted their own spending restrictions while others say they're spending even more because of the hurricane and the needs of Louisiana citizens.

For example, the Louisiana Department of Social Services hired temporary staffers and expanded office hours to deal with an influx of emergency food stamp requests and other needs from the hurricane.

"We're basically spending what we need to get things done," s aid Nanette White, a spokeswoman for DSS.

With the state's tax base scattered and one of the state's main economic drivers -- the city of New Orleans -- essentially shut down, taking valuable tax income away from state coffers, Louisiana's $18.7 billion budget is facing a hole that the head of the Senate's budget writing committee estimated would top $1 billion.

And without a specific outline ordered by the governor, spending limitations vary from office to office.

White said no formal policy has been put in place limiting spending on less immediate needs at DSS, but the secretary of the department, Ann Williamson, asked employees to watch their budgets and "be careful" with expenses.

State Treasurer John Kennedy put a freeze in his office on travel and other types of spending. State Superintendent of Education Cecil Picard has told his staff to be aware of their spending and use good judgment, according to the education department. Other agency chiefs are offering similar advice to their workers.

Rather than a piecemeal approach, Dan Juneau, president of the Louisiana Association of Business and Industry, said a comprehensive budget freeze should have been put in place shortly after the storm struck and state officials shouldn't expect federal disaster relief dollars to bail out a shortfall in the state budget.

In a column he writes weekly, Juneau said the general operating and construction budgets that went into effect July 1 "no longer reflect the critical needs of the state nor the availability of the tax revenues to fund them."

The budget includes at least $37 million in local, pet projects for lawmakers and $16 million in grant funds derided as "slush funds" because they are doled out to lawmakers under the governor's discretion. Juneau said some of the items should be reconsidered after Katrina.

"It would be interesting to see how many of these relatively unimportant budget items are being rushed through the spending process before the budget freeze is imposed," he said in his column.

(Copyright 2005 by The Associated Press. All Rights Reserved.)