Following the Louisiana House, now Senate takes its whack at closing state budget deficit



The $24.3 billion budget bill passed last week by the Louisiana House is about $163 million short, the Jindal administration told state senators who gathered on Memorial Day to take a first look at the state spending plan for next year.

That shortfall can be handled as the Senate tackles the legislation detailing how state government will spend taxpayer dollars for the fiscal year beginning July 1, Senate Finance Chairman Jack Donahue said in an interview after taking the first official look at the operating budget proposal.

Of more immediate concern is what to do about the 11 tax bills on which House Bill 1 relies.

Budget season began with lawmakers having to sort out a $1.6 billion deficit. But a series of bills that raise revenue along with some good luck as the economy improved and a potpourri of financing ideas closed about $860 million of that gap; spending cuts closed the rest.

The House’s version of the budget staved off draconian cuts in state support for colleges and universities while funding public elementary, middle and high schools along with some health care programs.

Not included in House Bill 1 is enough money to fully fund the charity hospitals that the poor and uninsured use, as well as covering a lot of the costs for the LSU medical schools in New Orleans and Shreveport.

Commissioner of Administration Kristy Nichols summarized the list of goals set by House leaders that went unfunded.

Depending on the Senate’s spending priorities, the budget proposal comes in about $155 million short of balanced, with an additional $8 million also needed to close out the budget year that ends June 30.

After the briefing, Donahue pointed out that most of those dollars were included in the House’s budget proposal, contingent upon the state Senate raising the money necessary.

Donahue views it as a wish list, more of a statement of how the House would like to see any new-found monies spent. “It’s not an obligation on our part,” he said.

His first focus has to be on the House-passed revenue-raising measures that generate about $615 million on which the budget proposal relies.

The House passed a bill that would increase the tax on a pack of cigarettes along with 10 other measures that adjust various tax breaks, including those for motion picture investors and solar energy systems. Those measures are pending in his Senate Finance Committee.

The business community views all the legislation rolling back tax exceptions, exemptions, rebates, deductions and credits as nothing more than tax increases on businesses. And Gov. Bobby Jindal has indicated that he too generally opposes the ideas.

But Donahue said Jindal’s opposition to individual revenue-raising bills may not translate into vetoes if the total amount raised by the tax increases is offset by the same total amount of decreases in other taxes.

Jindal insists that Louisiana’s budget must be balanced following the “revenue neutral” guidelines set by anti-tax crusader Grover Norquist’s Americans for Tax Reform, the Washington, D.C.-based group so influential in national Republican politics.

“From what I understand,” Donahue said, “it’s going to be a more wholesale approach to revenues raised and how many dollars have been given back.”

Standing nearby was state Revenue Department Secretary Tim Barfield, who said the aggregate balance between the total tax increases and total tax decreases will be calculated over a five-year period.

“It’s OK to have some things front-loaded” or raising more revenue in the early years, Barfield said. “We’ve had some real finite discussions, particularly with Sen. Donahue and others, now that these bills are coming over (from the House), on what we are looking for in terms of that offset.”

A handful of bills are in process that could be used to balance the tax increases, he said. The two largest tax decrease measures would be House Bill 828, by Rep. Cameron Henry, R-Jefferson, to phase out the corporate franchise tax, and Donahue’s Senate Bill 284, which would create a Student Assessment for a Valuable Education, or SAVE, credit program for higher education.

Henry’s HB828 is scheduled for debate by the full House on Thursday.

Donahue’s SB284 was debated Monday evening when the full Senate convened. (The House took the day off.)

The plan in SB284 would have no impact on students or their parents, but a fee would be included on the bills of the state’s 220,000 students in colleges and universities. Students would never pay the fee but would assign a refundable tax credit to the university, which would then bill the state for the amount.

“Isn’t there a simpler way?” New Orleans Sen. Karen Peterson, who also chairs the Louisiana Democratic Party, asked.

“Perhaps,” Donahue responded.

Calling the bill superfluous, Peterson said the fancy wording of SB284 appeared to be just a way to accommodate the governor’s promise to Americans for Tax Reform.

Donahue said he also likes “revenue neutral.”

“It may be accommodating to somebody else, but it’s accommodating to me, too,” he said.

The Senate passed Donahue’s SAVE legislation on a vote of 29-10. It now goes to the House for consideration.


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[20 May 2015]


Louisiana’s difficult financial picture brightened a bit on Tuesday.
That had state lawmakers saying they now face an easier job in meeting their constitutional responsibility to balance the budget this year and next, while achieving their goal of doing that without preventing cuts to the public health care system and to public colleges and universities.
“It gets us closer to where we need to be,” said Rep. Joel Robideaux, R-Lafayette, who is chairman of the tax-writing Ways and Means Committee. “Our hope is the Senate …

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[20 May 2015]

A package of House-approved tax bills estimated to raise $615 million for next year’s budget sailed through its first stop in the Senate on Monday, as budget negotiations continue.
Without objection, the Senate Revenue and Fiscal Affairs Committee advanced 11 bills to rework tax break programs, scale back state subsidies for businesses and raise the state cigarette tax by 32 cents per pack. Three bills would make an across-the-board cut of 20 percent for most of the state’s tax breaks.
The proposals — several of which face opposition from …

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[31 Mar 2015]

St. Tammany Council on Aging offering free box fans to seniors
By Robert Rhoden, | The Times-Picayune
The Council on Aging St. Tammany is offering free box fans to seniors who have difficulty keeping their homes a comfortable temperature in the warmer months, the agency announced Tuesday (March 31).
A limited number of 20-inch, three-speed box fans are available. The be eligible, seniors must be at least 60 years old, residents of St. Tammany Parish and registered as Council on Aging members, the agency said in a news release. Recipients must pick up …

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[31 Mar 2015]

Rick Smith re-elected to Covington City Council seat
By Kim Chatelain, | The Times-Picayune
Covington City Councilman Rick Smith was re-elected to a second term Saturday (March 28), beating back a challenge from political newcomer Laura Brown in a race that centered on a controversial school improvement project at St. Scholastica Academy. Smith received 56 percent of the vote in the council District E race compared to Brown’s 44 percent.
Both candidates acknowledge that the pending SSA project was a key issue in the race. The school’s ongoing effort to build a …

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[31 Mar 2015]

Eastern St. Tammany voters renew fire district parcel fee
By Bob Warren, | The Times-Picayune
Eastern St. Tammany Parish voters renewed a $39 parcel fee for Fire Protection District No. 1 on Saturday (March 28). The fee annually brings in around $1.2 million, the district had said while stumping for the 10-year renewal earlier this month.
While that is a small part of the district’s overall $18 million annual budget, Fire Chief Chris Kaufmann nonetheless had urged voters to renew the fee, which he said would help the district maintain its level …