No deal: Session ends with no agreement on taxes

BATON ROUGE (AP) — Louisiana lawmakers gave up on a tax deal Monday and closed their special session early, with the House unable to break a partisan impasse over a budget gap just months away.
Attention now shifts to the regular legislative session opening next week, when lawmakers are charged with balancing the budget for the year starting July 1 with nearly $700 million less in state financing than they had this year. The TOPS free college tuition program and health services for the poor and disabled could be at risk of deep cuts.
Gov. John Bel Edwards called the session to replace expiring temporary taxes with other taxes, saying without the money, spending reductions would damage critical services. But the Democratic governor couldn’t broker a deal between House Republicans and House Democrats.
After 15 days of work, lawmakers passed two bills. Neither would help raise money to close the looming “fiscal cliff.”
“I think it’s probably an understatement to say the special session was not as productive as it could have been or it should have been,” the governor said.
Factions in the House disagreed over which tax types should be used to replace expiring taxes — or how much of the gap should be closed with taxes.
GOP lawmakers who were willing to support revenue favored sales taxes, while Democrats, particularly the Black Caucus, wanted income taxes. Some Republicans insisted the special session was premature because it was too soon to know the true size of the budget hole. When it appeared enough votes existed to pass major tax measures, deals broke down over unrelated issues.
“It was a waste of taxpayers’ money. I think you’ve got two extremes in both political parties running everything,” said Rep. Kenny Havard, a St. Francisville Republican.
More than $1.3 billion in temporary taxes passed by lawmakers expire when the new budget year begins. Other increases in tax types along with money expected from state income-tax collections caused by federal tax changes are estimated to offset some, but not all the gap, leaving a hole pegged at $692 million.
Edwards predicted lawmakers won’t pass a budget that makes those cuts. Senate President John Alario and House Speaker Taylor Barras, both Republicans, agreed getting such a vote would be difficult. Already plans are in the works for another special session on taxes that could start as early as mid-May.
The do-nothing session was marked by frustration and mistrust in the House, which took votes over several days rejecting tax ideas. House lawmakers accused each other of reneging on deals, criticized colleagues on social media and clashed with the governor’s staff over who was to blame for the stalemate.
“We have certainly lost something around here. We’ve lost our way, members,” said New Orleans Rep. Walt Leger, the highest-ranking House Democrat. “We have a lot of work ahead of us. My solemn prayer is that we do come back together.”
Edwards blamed the special session collapse on a “spectacular failure” of leadership from Barras, who he said broke his word to deliver GOP votes for a package of tax bills.
“Even the most casual observer of the way the House conducted itself over the last two weeks can conclude that it was totally dysfunctional,” said the governor, a former House member.
Barras said Edwards “contributed to the collapse of this session” by demanding the full budget gap be offset and “being unable to garner the support of his House Democrats.”
With most tax measures required to start in the House, senators could do little but watch.
Special sessions are estimated to cost $50,000 to $60,000 a day, so the 15-day failed gathering cost taxpayers at least $750,000.
While Barras supported the holding of the special session, he didn’t have the backing of his full GOP membership, some of whom are strongly anti-tax. That meant Barras needed support from Democrats in the majority-Republican chamber to get passage of tax measures.
Barras and other Republicans willing to consider taxes wanted to temporarily renew one-quarter of an expiring 1 percent state sales tax, along with temporary elimination of some sales tax breaks. Democrats, particularly members of the Black Caucus, argued that would more heavily hit the poor. They wanted to tweak income tax laws, such as scaling back a tax break allowed for upper-income taxpayers.
The two sides also split over unrelated proposals, such as Medicaid restrictions, that Barras and other Republicans wanted tied to passage of taxes.