BATON ROUGE, La. -- An unexpected drop in state tax collections has created a midyear budget deficit that could be as high as $400 million.
The news has been delivered to Gov. Bobby Jindal's administration by state economists. It complicates an already dismal state financial picture as lawmakers prepare for the start of their annual session in two weeks.
The governor cut $248 million in the middle of the current 2009-10 fiscal year to adjust for shrinking tax collections. The latest deficit presents a worse problem since it's happening so late in the fiscal year. Any cuts that are made can only be spread over two or three months.
LSU economist James Richardson on Monday told The Times-Picayune the latest deficit stems from February tax collection figures that show sales and personal income taxes were far lower than economists predicted.
