Monday, April 27

Monday, April 27

The case for funding higher education
As LSU students prepare to march on the state Capitol and anxious investors pulled out of a $114 million bond deal for new dormitories at the state’s flagship campus, along comes The New York Times to explain why it’s so critically important for Louisiana to continue providing access to higher education that’s affordable for everyone. It’s become fashionable for some on the right to argue that Louisiana has too many four-year institutions, and that too many campuses primarily serve marginal students who might be better off seeking career or technical training. Thus, the reasoning goes, Louisiana should downsize its academic footprint and concentrate on its biggest campuses. But as David Leonhardt explains in the Times’ Upshot blog, two new studies demonstrate the benefits of a college education for students on the academic margins.

The economists and education researchers tracked thousands of people over the last two decades in Florida, Georgia and elsewhere who had fallen on either side of hard admissions cutoffs. Less selective colleges often set such benchmarks: Students who score 840 on the SAT, for example, or maintain a C+ average in high school are admitted. Those who don’t clear the bar are generally rejected, and many don’t attend any four-year college. Such stark cutoffs provide researchers with a kind of natural experiment. Students who score an 830 on the SAT are nearly identical to those who score an 840. Yet if one group goes to college and the other doesn’t, researchers can make meaningful estimates of the true effects of college. And the two studies have come to remarkably similar conclusions: Enrolling in a four-year college brings large benefits to marginal students.

What kind of benefit? For starters, the students who were just above the admissions cutoff earned 22 percent more by their late 20s than the nearly identical students who missed the cut. As Leonhardt concludes:

Yet the new research is a reminder that the country also underinvests in enrolling students in four-year colleges — and making sure they graduate. Millions of people with the ability to earn a bachelor’s degree are not doing so, and many would benefit greatly from it.

A key to making sure marginal, low-income students go to college – and graduate – is making sure higher education remains affordable. That’s why state financial support is so critical to public higher education. And why the Legislature is playing a very dangerous game with Louisiana’s economic future. “Where are the leaders” on budget mess?
The Times-Picayune editorial board looks back 13 years – to then-Rep. Vic Stelly’s successful effort to add progressivity and predictability to the state budget – and wonders if anyone in the current state Legislature has the courage, gumption and leadership ability to stand up to the administration and confect a more fair and stable tax structure.

Lawmakers who are fed up with a national political action group dictating state tax policy have to figure out how to avoid a veto by Gov. Jindal — which means they are obeying ATR by default. The Legislature could band together around a tax and budget plan that is fair and progressive. Lawmakers could pass it and get the people behind it so that it is veto proof. But that will take courage and determination. There are 144 members of the state House and Senate. There are smart and dedicated leaders there, but how many will step up? Who will stop worrying about this fall’s state elections and do what is right?


Gaps in LSU hospital deals
While looming cuts to Louisiana’s colleges and universities have been getting most of the headlines, the nine hospitals contracted by the state to provide charity care to the uninsured also are short of the money they need to maintain services. As Melinda Deslatte of the AP reports, legislators need to come up with an extra $159 million – with $88 million of that needed for the new $1.2 billion teaching hospital in New Orleans that’s due to open in August. The problems are equally severe in Shreveport, where Gov. Bobby Jindal’s administration outsourced control of the local teaching hospital to a foundation that had no experience running a hospital.

Already struggling with the costs from the hospital employees, LSU’s Shreveport medical school is considered to be “at risk financially and programmatically,” according to a consulting firm’s review of the privatization deal struck for the state-owned hospitals in north Louisiana.

A potential long-term solution could be looming in a resolution by House Speaker Chuck Kleckley and Speaker Pro Tem Walt Leger III  that was filed just before last week’s bill-filing deadline: House Concurrent Resolution 75 creates a financing mechanism that hospitals can use to draw down additional federal Medicaid dollars – but only if the state agrees to expand health coverage by next April. As Mark Ballard reports in The Advocate, the idea appears to be gaining traction among legislators.

Expanding the program would allow the uninsured — about 17 percent of the state’s population — to join Medicaid, and that program would reimburse hospitals for the expensive care they provide to these patients, many of whom can’t pay.


Busy week ahead at the Capitol
The Legislature enters the third week of its short two-month session, and committee agendas are packed with important legislation that LBP will be watching:

Monday: The House Ways & Means Committee takes up House Bill 119 by Rep. Harold Ritchie, which would raise the tax on a pack of cigarettes by $1.18 – which would raise an estimated $250 million per year in much-needed revenue. Click here to read LBP’s recent report on Louisiana’s cigarette tax, and why raising it would be good for public health and the state budget.

The same committee will take up HB 775 by Rep. Julie Stokes, which would change the way corporate taxes are calculated to a “combined reporting” method used in most states. To learn why this is a good idea, click here.

Tuesday: The Ways & Means Committee meets again, this time to take up a bill to cap the spiraling cost of Louisiana’s film subsidy program and eventually eliminate it altogether. House Bill 276 by Rep. Lance Harris would cap the program at $50 million in 2015 and phases it out entirely by 2019.

Wednesday: The House Health & Welfare Committee is scheduled to hear three bills dealing with Medicaid expansion, including a constitutional amendment by Rep. John Bel Edwards that would extend health coverage to nearly 300,000 low-income Louisiana adults and save the state at least $52 million next year.


Number of the Day

$102,969,123 – Projected savings, over five years, to the state general fund if Louisiana accepts federal dollars to expand Medicaid coverage (Source: Legislative Fiscal Office)