by James Ronald Skains
Journal Correspondent

"No doubt about it, our financial situation in Louisiana government is serious," Rep Jim Fannin, Chairman of the Appropriations Committee in the Louisiana House of Representatives, told the Piney Woods Journal. "To work out of this financial bind in Louisiana state government, we are going to have to balance our wants and needs."

"That in itself is difficult because government is always going to want more than it truly needs," Rep. Fannin, a native of Winnfield, pointed out. "We have created our own biggest problems in the last five years. We have grown state government by leaps and bounds in the last four years at a rate of 6.7%."

"Our current state government revenue stream is at the pre-Katrina level," said Rep. Fannin, a former building contractor. "However, our state budget is much bigger than it was before Katrina came along and oil prices skyrocketed."

"We had a tremendous financial surge in state sales tax revenue directly attributed to re-building after Katrina and Rita," said Representative Fannin, a Farm and Ranch supply store owner and operator at Weston in Jackson Parish. "Fortunately for state revenue, oil prices skyrocketed after the revenue surge from Katrina and Rita begin to taper off."

"The 2004-05 state budget was $9.2 billion but then it jumped to $10.3 billion in 2005-06," Rep Fannin elaborated. "The '06-07 budget jumped up to $11.7 billion and then we topped out in '07-08 at $12 billion."

"At their December meeting, the Revenue Estimating Committee concluded that Louisiana state government was facing an approximately $1 billion shortfall," said Rep Fannin, who was originally elected to the House of Representatives in a special election in 2003 and re-elected in 2005. "Also, they estimated that oil would have to stay at $45 per barrel or higher through the end of this fiscal year, which ends in June, or we would be facing severe deficits."

"Unless oil prices rebound in the next few weeks, we will have that additional problem to deal with," Rep Fannin acknowledged. "As most everyone knows, every dollar in oil prices represents $12 million in state tax revenue, so every dollar up or down in oil prices is a big deal for state government."

"The December '08 Revenue Estimating Committee was a real wake-up call for all of us," Rep Fannin stated. "State government is going to have to go on a vegetarian diet with very little pork."

"The revenue projection by the Revenue Estimating Committee for the next four years is based on $60 per barrel oil. The '08 budget was based on $68 oil," Rep Fannin pointed out. "Low oil and fuel prices are good for the consumer, but it is difficult for the state government especially since we have allowed state government to surge in size in the last five years."

"The next Revenue Estimating Committee meeting is scheduled for February 18th," Rep Fannin noted. "We may be in for another rude shock."

"The governor is obligated by the State Constitution to present the State Legislature with a balanced budget and that is what he is working on doing," Rep Fannin said, in elaborating on the specifics of how the budget process works in Louisiana. "Once the balanced budget is presented to the legislature, then it is our duty under the Constitution to scrutinize the budget, find the money for the budget and appropriate that money."

Rep. Fannin was selected by first term Governor Bobby Jindal to head the House Appropriation Committee in early 2008. This will be Rep. Fannin's second year to steer a budget through the Legislative process. The current year Legislative session begins on April 27th and ends in early June.

"It's a lot of work to even be on the House Appropriation Committee, but even more to try to head it up," Rep. Fannin acknowledged. "It seems that I spend most of my time either in Baton Rouge or driving back and forth from Baton Rouge."

"I think that I spend more time right now in Baton Rouge than I do in my legislative district," said Rep.Fannin, a 1965 graduate of Winnfield High School. "If it wasn't for my wife and the loyal employees at my Farm and Ranch Supply store, I wouldn't be able to keep it going."

"Jackie Adams, my legislative assistant here in the district, helps keep me up to date on everything, plus I've got a lot of help available in Baton Rouge," Rep Fannin noted. "Getting a budget to balance in good economic times is not a great challenge, but when it comes crunch time and the revenues are not there, then you have your work cut out for you because we can't print money like the Feds."

"We've had surpluses in past years and do now have some money in the Rainy Day fund,'' Rep Fannin explained. "However, the State Constitution allows us to do only six things with surplus money. First, we have to fund the Rainy Day Fund to bring it up to $775 million,'' Rep Fannin elaborated. "Secondly, we can pay down the debt with surplus money as well as spend it on Infrastructure and Highways, Unfunded Accrued Liabilities, Coastal Restoration, and Deferred Maintenance.''

"I'm also concerned that the State Police has moved away from some of the programs we set up a few years ago to make life a little easier for the loggers in our area," Fannin pointed out. "You may remember that we set up a voluntary inspection program for log trucks so that loggers would get a chance to bring their trucks up to DOTD standards before getting a ticket."

Rep. Fannin contintinued, "I've never tried to defend gross negligence tickets on log trucks and never will, but there are so many nit-picking tickets that the State Police can write. That was why that the volunteer truck inspections worked so well for the loggers.

However, we seem to have lost our lines of communication with the DOTD and we've seen a rash of tickets lately," Rep. Fannin noted. "I'm working to set up a meeting with the loggers and the State Police to try to get things back on track as we once had them."

"Timmons Trucks has offered to furnish a meal for a meeting between the loggers and State Police to hopefully begin to resolve some of the more minor issues,'' Rep Fannin said. "I want to help the loggers all I can, but I can't condone gross negligence on the trucks. I know that every time a log truck is pulled over for an inspection, that logging operations probably loses a load of logs for that day."

"I'm also very concerned with the situation with Smurfit-Stone and am trying to help in every way I can," Rep Fannin pointed out. "I was very encouraged that they were able to refinance some of their debt and increase their working capital. However, these are very bad times in the paper market."

"The Jeld-Wen company tells me that they are still committed to opening their new plant south of Dodson on Hwy 167, but they say they will only do so when the market rebounds," Rep. Fannin acknowledged. "To me that's a pretty broad statement that tells me that they don't really have a firm opening date at this point."

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