Treasurer John Kennedy has issued this statement as he states that "Moody's Investors Service warned today that Louisiana has years of unresolved structural budget deficits and needs to act quickly in order to achieve credible balance"
"Moody's is giving us the game plan for how to avoid a credit downgrade," said Treasurer Kennedy. "We need to stop spending more than we take in. We need to stop relying on one-time fixes to plug holes in the budget. We need to stop trying to borrow our way out of this problem."
The state addressed a $487 million mid-year deficit last month by delaying payments, borrowing from funds and taking money out of the Rainy Day Fund. Borrowing from funds decreases the state's financial liquidity.
"Our spending problem is creating a cash flow problem," said Treasurer Kennedy. "So far this year, I've approved nearly $200 million in seeds so state agencies can pay their bills. At some point, I'm going to run out of borrowable funds. We've got to fix our budget, and we've got to fix it fast."