Friday, April 24, 2015

Friday, April 24, 2015

Could Jindal veto the entire budget?; Grace: No clear solutions on budget; Candidates promise more transparency; and Hospital financing deal rejected by feds


Could Jindal veto the entire budget?

And if so, could the Legislature override that veto? The question is not entirely esoteric after the governor met with reporters Thursday and threatened to veto the entire state budget bill if it relies on what he regards as “tax increases” to achieve balance. As The Advocate’s Elizabeth Crisp reports:


“I’ve told the Legislature that I will veto the budget if it is balanced using revenues from tax increases,” he told reporters during a briefing in his State Capitol office Thursday. The remarks are among his firmest statements yet in the fight over how to address Louisiana’s looming $1.6 billion funding shortfall in the coming year. Jindal said he expects significant movement on budget-related bills in House committees next week but still described the process of cobbling together a spending plan for the budget that begins July 1 as “a lot of moving parts.” “We know there are a lot of ideas,” Jindal said. “I think you’ll see a number of ideas advance next week.” Jindal’s strict anti-tax stance has left legislators looking for other options to fill the gap. Jindal, in a similar reporter briefing last week, said people shouldn’t be surprised that, even as the state faces a potentially devastating budget crisis, he won’t consider revenue-generating proposals he sees as tax hikes. This week he said he met with House and Senate leaders and has made his position firm.


To be sure, we’re a long way from getting to that point. But as legislators scramble to find tax schemes that fit the governor’s oddly complex definition of “revenue neutrality” (It’s OK to raise taxes provided the revenue is sent to local governments to make up for the loss of revenue from repeal of the inventory tax), there has been talk around the Capitol of raising revenue by suspending tax exemptions for a year via resolution – which the governor can’t veto – and letting the next governor grapple with the structural changes that need to be made. But yesterday’s comments made it clear that any such move would need enough votes to override a budget veto.


Grace: No clear solutions on budget
The Advocate’s Stephanie Grace watched Wednesday’s Senate Finance Committee hearing on a bill that repeals the state inventory tax and was not reassured that the Legislature would come up with a cogent budget compromise. The problem with the inventory tax plan is twofold: First, there are serious doubts that it would take effect quickly enough to affect next year’s budget, since any repeal would have to be approved by voters in October. And second: Repealing the tax means legislators would need to raise new revenue to offset the loss of revenue to local governments, which currently rely on the inventory tax to pay for schools, public safety and other basic needs.


“Where are we going to get the money to fund this program anyway?” asked state Sen. Greg Tarver, D-Shreveport. “I don’t want to go home and make sure the locals are OK and lose the hospitals in this state, close the universities in this state.” Adley’s best answer, which he repeated over and over again, was that they had his word. That’s hardly reassuring, given that the state would have to find yet another pot of money to send the parishes’ way, or else come up with a creative maneuver to allow them to raise more on their own. But it was enough for committee members, who voted 9-1 to approve the measure. Even Tarver, despite his obvious misgivings, went along; the only nay vote came from New Orleans Democrat Ed Murray.


Candidates promise more transparency
Whoever is elected governor next year will likely be more open and transparent about the way his office operates. That was the word from the four major candidates, who met Thursday for a candidate’s forum hosted by the Public Affairs Research Council. It won’t be a hard promise to keep, as it’s hard to imagine a chief executive being less transparent than the current occupant of the Governor’s Mansion, who has refused to release a single email from his time in office. The AP was there:


Republican Public Service Commissioner Scott Angelle, Republican Lt. Gov. Jay Dardenne, Democratic state Rep. John Bel Edwards and Republican U.S. Sen. David Vitter say they’ll push to limit the broad public records exemptions granted to the governor’s office. The men said a 2009 public records law change that shields anything considered the governor’s “deliberative process” has been stretched too far and should be changed. Dardenne and Edwards said the exemption has been abused. Vitter said he’d issue an executive order curtailing it on his first day in office.


Hospital financing deal rejected by feds
The federal agency that oversees the Medicaid program has once again rejected a key financial underpinning of Louisiana’s move to privatize its charity hospital operations. As Marsha Shuler reports in The Advocate, the Centers for Medicare and Medicaid Services rejected the state’s use of advance lease payments to prop up the deals.


In all, the state used $260.8 million in advance lease payments to prop up the deals involving public hospitals, including those in New Orleans, Lafayette and Houma. DHH had asked CMS to reconsider its disallowance of $189.9 million in federal financial participation for the hospital deals using the lease payments as the state share. The disallowance covered Jan. 1, 2013 to May 23, 2014.


A spokeswoman for the Department of Health and Hospitals told the newspaper that the state will appeal.


Number of the Day

$190 million
– Amount Louisiana may have to pay back to the federal government due to flaws in the Jindal administration’s charity hospital privatization (Source: The Advocate)