Gov. Bobby Jindal said Tuesday that he won't ask the Legislature to consider the controversial prison privatization bill until they get an updated revenue forecast, signaling a willingness to compromise on the hot-button issue that has drawn bipartisan opposition.
Rep. Robert Johnson, D-Marksville, one of the strongest critics of the plan to sell prisons, said he was happy to see that the governor is willing to accept alternatives.
"I'm glad to see he's starting to realize this is not the best way to proceed," Johnson said. "In recognizing that this is such a bad deal, he is starting to show some leadership, which is welcome."
Besides Johnson, the prison sale idea has also caught harsh opposition from former Avoyelles Reps Raymond Laborde and Charles Riddle, III.
According to a New Orleans Times-Picayune article, to avoid raising taxes, Jindal sent lawmakers a budget bill that includes $86 million for health-care costs tied to the sale of state-owned prisons in Winn, Allen and Avoyelles parishes, which requires separate legislation. The plan has drawn criticism, particularly from legislators from Avoyelles Parish who fear the loss of well-paying jobs if operations are privatized.
But if a state forecasting panel determines that next year's tax collections will be higher than earlier predictions, lawmakers could plug the new revenue into health-care programs. That, in turn, would lessen the urgency to sell the prisons.
The Revenue Estimating Conference -- a four-member panel that determines how much the state can spend each year -- typically meets in mid-May to update the official forecast.
Although Jindal said he will continue to support the prison sales no matter what revenues become available, the decision to postpone consideration of the legislation suggests the governor is willing to bend on the issue if it doesn't mean having to make deeper cuts to health-care services.
"We think it's important that they (legislators) understand the context" in which they'll be considering the privatization effort, Jindal said at a news conference.
The prison sales are one of two privatization efforts that are part of Jindal's efforts to patch a $1.6 billion budget shortfall without resorting to tax increases.
The other initiative -- a plan to privatize the state Office of Group Benefits -- came under withering criticism Tuesday from members of the Senate Retirement Committee, who questioned the long-term savings to the state.
The group benefits office currently manages the health insurance coverage for more than 200,000 active and retired state workers and their families. Jindal is proposing to outsource the claims management to a private insurer, arguing that Louisiana is just one of two states that currently handles that function using state employees.
Commissioner of Administration Paul Rainwater told lawmakers that the privatization would have "no negative impact" on premiums or benefits.
The potential revenues from the sale of the insurance plan has not been included in the budget, though the budget does include $10 million in projected "efficiencies" from firing 149 workers as a result of privatization.
The privatization plan has drawn opposition from active and retired state employees, and the Louisiana Democratic Party. But unlike the prison sales, it does not require separate legislation. Instead, any contract the state signs with a private insurer only needs approval from a House-Senate budget committee, which is stacked with administration allies.
That did not stop several lawmakers from complaining about the effort.
"Proceeding with this is a huge, huge mistake," said State Sen. Butch Gautreaux, D-Morgan City, who chairs the Senate Retirement Committee. "I think it's unfair to the employees, to the retirees, and ... to the taxpayers."
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