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The Daily Dime is a summary of the day's news stories related to the state budget and issues that affect low- and middle-income individuals and families, compiled every business day by Louisiana Budget Project staff.

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Our Two Cents

Wednesday, March 25, 2015

Posted on March 25, 2015

State Police siphons more road dollars

Gov. Bobby Jindal proposed moving $72 million in gas tax money away from road improvements and maintenance to cover State Police operational costs.  Julia O’Donoghue of Nola.com writes:

 

Louisiana faces a $12 billion backlog in transportation infrastructure projects. Money from the 20-cent state gas tax goes is supposed to be set aside in a state transportation trust fund to address this need. Yet a significant chunk of the fund’s revenue has gone to pay for public safety functions over the past several years. Next year will be no different if the governor gets his way.

 

The Advocate also weighed in:

 

The issue surfaced during a review of planned spending by the state Department of Transportation and Development by the powerful House Appropriations Committee. The gathering came just weeks after the completion of work by a special state panel on how to address transportation needs. Topics on that committee included whether the state should re-examine how much it is diverting from the transportation fund to State Police. Senate Transportation Committee Chairman Robert Adley, R-Benton, who was co-chairman of that study panel, has repeatedly said the state should do just that, especially at a time of shrinking state aid for road and bridge maintenance. “There is a general feeling out there that we are cutting the maintenance money,” said House Appropriations Committee Chairman Jim Fannin, D-Jonesboro.

 

Film subsidies are (still) really expensive

A state-commissioned study of Louisiana’s film tax credits, released Tuesday, found that the subsidy program continues to cost state taxpayers far more money than it brings in through new revenue and remains a drain on resources. The study by retired LSU economist Loren Scott found that the state gets back between 18 and 24 cents for every $1 it spends on tax credits. On the bright side, it found that the total amount of film credits dropped in Louisiana last year to $226 million, from $251 million the previous year. As The Advocate’s Gordon Russell reports:

 

There are some positives for the film industry in Scott’s report. He estimates that the industry supported 12,641 jobs last year, and that those jobs paid an average of $60,114 – roughly 44 percent more than the average wage in the state. However, that figure comes with what Scott calls an “important caveat.” The average includes wages earned by actors, directors and producers, and is thus likely inflated. “It is a heroic assumption that these monies will actually be spent in Louisiana, since these individuals are typically not Louisiana residents,” Scott wrote. “Inclusion of their salaries in the ‘certified Louisiana spend’ for tax credit purposes no doubt exaggerates” their impact.

 

Healthcare costs fall under Obamacare, Medicaid expansion

The expansion of health coverage for low-income adults under the Affordable Care Act – particularly in states that expanded their Medicaid programs –  has reduced significantly uncompensated care costs for hospitals around the country.  Reuters has the story:

 

In 2014, hospitals’ uncompensated care costs were estimated at $27.3 billion. But that compared favorably to an estimated $34.7 billion if the uninsured rate had remained at its 2013 level, according to the report from a division of the U.S. Department of Health and Human Services. Most of the reduction came from the 28 states and Washington, D.C., which expanded Medicaid health coverage for the poor, with a reduction in uncompensated care of $5 billion and bad debt of $1.1 billion, according to the report. Even states that did not expand Medicaid, however, reduced these costs. They saw a $2.4 billion reduction in uncompensated care and an $800 million drop in bad debt. The government has pointed to the expected decrease in costs for uncompensated care in 2014 as an indication that President Barack Obama’s healthcare reform law, also known as Obamacare, is working.

 

Louisiana workers lack access to sick days

A report by the Institute for Women’s Policy Research reveals a troubling trend in paid time off for workers.

 

An analysis by IWPR finds that approximately 41 percent of all workers (45 percent of private sector workers, compared with 17 percent of public sector workers) living in Louisiana lack even a single paid sick day. This lack of access is even more pronounced among low-income and part-time workers.

 

Tax hikes acceptable to most Louisianans

Most state residents want policymakers to take a balanced approach to solving the state’s budget problems that includes a mix of tax increases and spending cuts, according to the latest edition of the annual LSU survey. Only 13 percent favor the cuts-only approach advocated by Gov. Bobby Jindal.  Mark Ballard of The Advocate writes:

 

As far as the majority of the state’s population is concerned, Louisiana lawmakers have come to a fork in the budget road and both paths seem wrong, says the latest chapter in the LSU annual survey released Tuesday. Roughly eight of every 10 Louisiana residents would cut government spending — but not to education, health care or highways — to fix the $1.6 billion shortage in revenues. Eighty-five percent of those surveyed also would accept some tax increases, but about half of those people would want more cuts than tax increases. Still, the respondents voiced little support for raising specific taxes. The tax increases with the most support are for tobacco, alcohol and gambling.

 

Number of the Day

$313 Million – Amount of gasoline tax proceeds diverted from the transportation trust fund under Gov. Bobby Jindal. (Source: Associated Press)

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