Budget still the focus after 3 months of sessions

After nearly three months in session, Louisiana’s Legislature is still no closer to solving the state’s projected budget deficit than when it started. However, legislators are looking to change that within the next two weeks.

The Legislature ended the regular session Friday so that legislators could go into a special session Tuesday to close the projected budget deficit for the 2018-19 fiscal year beginning July 1. This special session will be the second one in 2018 after the Legislature held a session Feb. 19 through March 5 that failed to accomplish much work on the budget.

State government is facing a $550 million to $650 million projected deficit to fill in the upcoming fiscal year budget.

The special session is slated to end June 4, the originally scheduled end date of the regular session. Legislators went into the regular session March 12.

Legislators will aim to replace temporary taxes enacted in 2016 that expire June 30, and thus avoid deep cuts to the state budget in areas including health care and higher education. They were unable to pass any tax bills during the regular session because that type of legislation may only be addressed in regular sessions during odd-numbered years.

Still, legislators spent much of the regular session poring over the proposed budget and approved a budget that Gov. John Bel Edwards vetoed.

“It has been a wild session,” Rep. Beryl Amedee , R-Houma, said Monday.

Edwards administration sent notices to nursing homes a couple of weeks ago warning that the state was at risk of having to evict thousands of nursing home residents if revenues weren’t raised in the budget that passed the House.

But the Senate fully funded the Department of Health and Hospitals, taking money from other places so that no nursing home residents would be evicted, Amedee said.

“Now we’re coming into the special session technically with no budget at all,” she said. “If it took us three months to work on the last one, I’m not sure what our chances are of getting another budget written up and agreed to in 14 days.”

Rep. Sam Jones, D-Franklin, said he was against both the budget bills that passed the House and the Senate.

“One destroyed health care, and the other one destroyed higher education. And it even filtered down to impacting the courts and the judges and the sheriffs,” Jones said.

State leaders “have no choice but to figure out a way to fix this in the special session,” Jones said.

Sen. Bret Allain, R-Franklin, who serves as vice chairman of the Senate Finance Committee, “will be spending all of my time on the budget … because of my position,” he said.

“The budget really took up all of our time,” Allain said of the regular session. “I think we pretty well defined the budget that we need to fund at this time. And we’ll try our best to send it to the governor.”

Edwards’ call for the special session has a list of 32 items that can be addressed during the session. Included in that list are sales taxes, income taxes, fees and statutory dedications.

Allain expects legislators to agree to extend a half-cent of the temporary 1-cent sales tax that is set to expire for the state’s fiscal year ending June 30. That would leave the state with a 4.5-cent sales tax for every dollar of taxable items.

Jones hasn’t had many complaints from people about the temporary one-cent sales tax, so cutting half of that temporary tax “is reasonable until we get out of this mess,” he said.

“We’re still recovering from (former governor) Bobby Jindal’s disaster,” Jones said, referring to the budgeting practices during Jindal’s administration.

The Legislature might implement a few other revenue raising measures in the special session and then “call it a day,” Allain said.

“To fund what we have will require some dollars,” Allain said. “But there’s no other place to get it from right now. I think that’s the prudent thing to do.”

Amedee anticipates legislators will draft bills this week with the House Ways and Means Committee the first group to hear any tax bill proposals. Those bills would then go before the Appropriations Committee, on which Amedee serves, maybe the end of this week or start of next week, she said.

Though the budget occupied most of the legislators’ time during the regular session, one key bill of Allain’s passed during the session involved removing commercial watercrafts from regulation under the Louisiana Motor Vehicle Commission.

In 2016, state officials gave authority to that commission to regulate the commercial watercraft industry. The U.S. Coast Guard already regulates this industry, Allain said.

“We passed a bill that says they (commercial watercrafts) shouldn’t be regulated by the Motor Vehicle Commission,” he said. “It didn’t make sense. I think they inadvertently got caught up in that.”

Boat builders were constructing vessels for commercial and governmental purposes and having to go through dealers to get parts, such as engines, Allain said.

“No other state does that. So we were putting our boat builders at a competitive disadvantage to boats being built in Alabama and Mississippi and Florida,” Allain said.