Thursday, November 29, 2007

Jindal panel urged to pay down state retirement debt

State lawmakers should apply a chunk of Louisiana's $1 billion budget surplus to paying down debt in the state retirement systems, an advisory group to Gov.-elect Bobby Jindal was told Wednesday.

The advisory council is one of nine groups, each with dozens of members, appointed by Jindal to collect public testimony and make hiring and policy recommendations as his administration prepares to take control of state government Jan. 14. Although the administration has no obligation to act on the fiscal panel's advice, its work will be closely watched as Jindal prepares his first budget after a campaign in which he frequently labeled state spending as "out of control."

Jindal never promised to cut spending, but he frequently criticized the 2007 Legislature for adding more than 1,100 new state jobs without a comprehensive plan. Louisiana already has more state workers per capita than its Southern peers, and the state's budget has grown rapidly in recent years.

But Keaton said the jobs figure is "skewed" by the fact that Louisiana operates a statewide public hospital system. In other states, public hospitals are usually operated at the city or county level, so their workers are not state employees.

Louisiana can save plenty of money in future years if legislators are willing to use part of its budget surpluses to pay down some of the $11 billion in debt that has piled up in the Louisiana State Employees Retirement System and the Teachers Retirement System.

The debt is scheduled to be paid back, with interest, by 2029, but the state can save hundreds of millions of dollars in future interest costs by making early payments on the principal.

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