BATON ROUGE, LA (WAFB) - A heated start to Monday's Revenue Estimating Conference.
"Now, you can try and put lipstick on the pig but it's still a pig," said State Treasurer John Kennedy.
"I don't have any desire to argue with you. You came to the table clearly to point fingers," said Kristy Nichols, with the Department of Administration.
Before they could get around to this year's bad news, Nichols and Kennedy argued with each other on last year's surplus, which Kennedy called a deficit because the state spent more money than it brought in.
"Both bad news, but still relatively close bad news," said Sen. John Alario, a member of the Revenue Estimating Conference.
Once things calmed down, the conference tackled their attempt to balance a $1.4 billion shortfall in next year's budget which takes effect July 1st.
"Oil prices are down. Our budget has a lot of oil revenue in it and that means oil revenues will be down," said Jim Richardson, an LSU economist and member of the Revenue Estimating Conference.
Down $126 million, a new deficit for the current budget which must be addressed before looking ahead at next year's problems.
"These mid-year cuts are critical," said Rep. Chuck Kleckley, Speaker of the House and member of the Revenue Estimating Conference.
And the bad news keeps coming, the recent drop in oil revenue has now pushed next year's deficit up from $1.4 billion to $1.6 billion.
Richardson, Speaker Kleckley, Sen. Alario and Nichols approved the Legislative Fiscal Office's forecast for this year, next year and the three years after that.
The Fiscal Office forecasts a $69 barrel of oil for the rest of this fiscal year. That's down $12 from November and $23 from May. And their forecast on oil gets worse, projecting a $60 barrel price for next year's budget.
"The big money in this case is oil because the mood is so dramatic," said Greg Albrecht, chief economist with the Legislative Fiscal Office.
But there is a bit of good news, with cheaper gas prices, sales tax revenue is forecast to increase. Offsetting, to a degree, the drop in oil.
The numbers set at the conference will be used to put together the governor's budget proposal. That's expected by the end of February.
Nichols says she hopes to avoid making cuts to higher education for the rest of this year. But at some point, possibly next year as the treasurer's office expects, the governor could cut as much as $300 million from higher education.