Key Takeaways
- Louisiana is wading into uncharted territory when it comes to funding for public education.
- A recent executive order from the governor seeks to cut the Minimum Foundation Program, the mechanism that funds public education, by $168 million and reallocate that money to teacher pay raises.
- There has never been a direct cut to the MFP before, and it raises interesting questions about the law and the intent of the constitution.
Even during the worst days of the Great Recession and the budget reductions that rocked the state for nearly a decade, neither the governor nor the Legislature made cuts to the MFP. In fact, there is no recollection of that ever happening since the current constitution was enacted in 1974. That is largely because the MFP, meaning public education, is one of the most protected areas of the budget.
That makes the actions being taken now to reduce the MFP allocation to local school districts and redirect those funds to teacher pay raises unprecedented. Not surprisingly, it has also prompted questions about the legal authority the state has to reduce the MFP. In reviewing the constitution, the answers are perhaps a little cloudy, but the issues are of interest, nonetheless.
There are two sections of the constitution in play. One, is Article VIII, Section 13(B) which establishes the MFP in law. It basically says neither the governor nor Legislature can reduce the appropriation made to the MFP except through a limited procedure that requires the addition of specific language in the appropriations bill, and the written consent of two-thirds of each house of the Legislature. In the current case, the Legislature included that language in HB 1, the 2026-2027 appropriations bill, and the governor has issued an executive order making the reduction and reallocation. The Legislature is in the process of voting by mail on whether or not to approve it.
But elsewhere, in Article VII, Section 10(F), the constitution spells out how the governor and Legislature by a two-thirds vote can make cuts to constitutionally protected funds, like the MFP, in the case of a budget deficit. It requires some of the same actions as mentioned in Article VIII, but it’s a bit more complicated.
- Constitutionally protected funds, including the MFP, cannot be cut to erase a budget deficit projected for the coming year unless: 1) the official forecast of recurring revenues for the next fiscal year is at least one percent less than the official forecast for the current fiscal year and 2) the total amount of other non-protected appropriations have first been reduced by at least 7/10ths of one percent.
- Once that happens cuts can be made to constitutionally protected funds or dedications, excluding the MFP, by no more than 5%.
- Cuts to the MFP cannot exceed 1%, nor can they total more than the deficit.
Since the constitution requires that the state budget be balanced, it is important that state leaders have the tools they need to deal with budget deficits. But even in the critical case of balancing the budget, the constitutional mechanism for cutting the MFP in Article VII is highly restrictive. Other cuts must be made before they can touch the MFP and even then, the amount that can be cut is much more limited than it is to other protected funds.
By contrast, the language in Article VIII is less restrictive. It allows the governor and the Legislature (with a two-thirds vote) to reduce and redirect the MFP, presumably for any reason, with fewer strings attached, and no apparent limit.
Interestingly, it doesn’t appear the constitution’s Article VIII language that provides more flexibility regarding MFP reductions is explicitly tied to the Article VII language that is more restrictive. It’s curious why that would be.
To add additional context, the state is not currently facing a budget deficit. The official forecast for next fiscal year’s State General Fund is actually about $118 million higher than the current year. And the cut to the MFP that is being proposed is roughly 4.2-percent, far higher than the one-percent the constitution would allow if there actually was a budget shortfall.
Which begs the question, what is the real intent of the constitution when it comes to reducing the MFP? There is evidence to suggest that it seeks to protect the MFP from cuts to an extraordinary degree compared to other areas of the budget. Yet there is also language, that the current executive order is utilizing, to make major reductions. That looks like a possible contradiction.
How, or whether, all this will be sorted out is unclear and may remain so, unless this constitutional question is clarified by a court. Either way, the scenario that is unfolding now could create new, and perhaps unforeseen, precedents. Which is why lawmakers might want to consider revisiting the somewhat murky constitutional language surrounding the MFP in the not-too-distant future.