Louisiana lawmakers have money to spend on teacher pay and other budget priorities after state revenue projections were adjusted upwards through June of  2025.

The state’s revenue estimating conference – made up of lawmakers, a gubernatorial appointee and an economist – adopted a financial forecast that increases the amount of money available to legislators for spending by $197 million in the current budget cycle and $88.6 million in the next. 

The additional funding is coming from higher interest earnings on state funding investments, as well as larger corporate and severance tax collections.

The revenue hike makes it less likely public schools teachers will see the pay cut included in the budget plan passed by the Louisiana House last month. An approximately 2,000-seat reduction in early childhood education slots may also be restored, according to interviews with legislative leadership.

Gov. Jeff Landry’s administration would also like to put more money into child welfare programs, which are experiencing chronic staffing shortages, said Commissioner of Administration Taylor Barras, who acts as Landry’s budget chief, in an interview Tuesday. 

All of those budget issues must be resolved within the $88 million newly available for the budget year that starts July 1. Legislators are not supposed to use the increase in money for this fiscal year – the additional $197 million – to cover those costs.

If lawmakers are budgeting prudently, the extra $197 million would mostly be reserved for one-time expenses, such as paying off the state’s outstanding debts, covering one-time maintenance projects or fixing roads and bridges. 

But there is a catch this year.

Legislators can only spend the entire $197 million in extra cash in the next 13 months if they vote to bust through a constitutionally-imposed spending cap. Otherwise, they will only be able to access $86 million of the $197 million over the next year, according to legislative staff.

Lawmakers have only voted to bust through the cap a few times, in 2007, 2008 and last year, when the action was controversial.

In 2023, outgoing Republican legislative leaders and Gov. John Bel Edwards pushed to remove the cap so they could spend more money on higher education and transportation projects on their way out of office.

Conservatives opposed last year’s cap lift however, painting it as fiscally irresponsible. A few legislators who fought busting the cap in 2023 are now in charge of the Legislature under Republican Gov. Jeff Landry. Now that they are in charge of the money, their viewpoint on cap-busting may  change.

Barras said he has not discussed lifting the spending cap with Landry yet, so it’s not clear where the governor might stand on breaching the limit.

“There’s been no discussion about that until today,” he said. 

This is a developing story. Please check back later for more details.