Governor Jindal's budget advisors predict a shortfall of nearly a billion dollars for the fiscal year that starts in July.

The Louisiana Office of Planning and Budget says the deficit is in the neighborhood of $963 million. Council for A Better Louisiana president Barry Erwin says it's more bad news, like the state has been having the last few years:

That's a pretty considerable chunk of change to have to deal with, particularly, when you're talking about the healthcare issue and the cuts that we're already having to make. I think it's going to put a huge strain on health care and on the hospitals which are already under strain.

According to OPB director Barry Dusse, over a third of the shortfall - about $355-million - is tied to the drop in federal Medicaid matching funds. $250 million is from loss of one-time dollars that were being used to pay for recurring expenses. Erwin says state colleges will be targeted to balance the shortfall "because again, just as we've been saying in the past, there's very few places to go for cuts."

I think higher education is going to have to brace for another round of probably pretty significant cuts.

Erwin says health care and higher education are the path of least resistance when dealing with budget deficits. Governor Jindal has said tax reform will be part of his 2013 agenda, but Erwin says that won't generate the revenue needed to balance the budget:

Whatever he does in terms of tax reform, he would like it to be revenue-neutral. So if you take additional revenues off the table in the beginning, it just pretty much leaves cuts.