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Jindal cost savings deal criticized

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SHREVEPORT, La -

Spending four million dollars to find ways to save maybe hundreds of millions every year for the state of Louisiana. That's what the Jindal administration is doing. And it has critics who say it's wasteful.

The Jindal administration is paying a New York company, Alvarez & Marsal, $4.2 million to see how Louisiana can save $500 million a year. They'll look at areas like health care, transportation, public safety and debt collection, among others.

That may sound like a good trade, until you consider what former state budget director Stephen Winham said in a recent blog post.

Winham explained that:

The governor's Division of Administration already has some 700 employees and a budget of over $75 million. Their job, in part, is to ensure "the efficient and effective operation of state government;"

Each house of the legislature has its own fiscal staff focused on state spending;

Each executive department has an undersecretary whose role is to advise the governor directly on these matters.

Winham also notes the long history of creating blue ribbon panels to find cost savings. In fact, during Jindal's first term, the Commission on Streamlining Government -- a panel of lawmakers, executive branch officials, and experts from the private sector -- estimated they found more than $780 million in savings with its 238 recommendations, most of which it said were implemented.

Winham wrapped up his blog post with a one word, all caps description for the Jindal contract -- "STUPID."

Louisiana's Commissioner of Administration Kristy Nichols responded to us, saying, "To continue to create savings and improve services for the public, Louisiana chose a partner in Alvarez & Marsal with first-rate experience in driving efficiencies in the toughest public sector environments. They have a proven history of saving hundreds of millions in taxpayer dollars.

But lawmakers we talked to from both parties are skeptical that the company can find half a trillion in annual savings.

"The large part of our budget, over 75 percent of it, is dedicated," says Republican Sen. Robert Adley of Benton. "You can't do anything with it."

And, complained Democratic Rep. Patrick Williams of Shreveport, "That 4.2 million. Do you know how many prescription drugs that can pay for our elderly, or books it can pay for our students, or teacher salaries. I mean it just doesn't make sense."

Williams and Adley also question where that $4.2 million is coming from to pay the company, since this was done while the legislature's out of session. The money comes out of the Division of Administration's budget, which was part of the overall plan submitted by Jindal and approved previously by the legislature.

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