Thursday, April 2, 2015

Thursday, April 2, 2015

Cost control for TOPS?; Is DOA skirting the law in sale of tobacco settlement?; Film credit bills are piling up; and Candidates are short on tax specifics


Cost control for TOPS?

Louisiana’s “merit-based” college scholarship program may be getting some much-needed cost controls under legislation unveiled Wednesday by the chairman of the Senate Finance Committee. Senate Bill 48 by Sen. Jack Donahue of Mandeville would freeze tuition payments in the Taylor Opportunity Program for Scholars at 2015-16 levels unless the Legislature votes for a raise. As Melinda Deslatte of the Associated Press reports, the bill seeks to make the state budget more predictable, since the cost of TOPS currently grows every time universities raise tuition.


Bills filed in previous sessions aimed at controlling the cost of the program have died quick deaths, but Donahue’s legislation has the critical support of Phyllis Taylor, whose late husband founded the program and has long been its chief protector. Still undecided is whether the bill will get support from Gov. Bobby Jindal:


“TOPS is an excellent program that helps our kids get a great education. We will oppose any bill that caps TOPS or limits the ability of qualified Louisiana families to utilize this program. We will review this bill as it goes through the process to determine if it will have a negative impact on the program,” Jindal spokeswoman Shannon Dirmann said in a statement.


The Advocate reports that Donahue plans to file companion legislation that will allow universities to set their own tuition. Louisiana is the only state that requires two-thirds legislative approval to raise tuition.


“The Legislature should be out of setting tuition,” Donahue said. The bills Donahue is preparing would require approval by two-thirds of the Legislature and majority support by Louisiana voters before the authority would be given to the universities. We can’t continue as a state to have the Legislature have to decide what tuition universities should be able to charge. Each of these universities has their own board,” Donahue said. “I think we can give them the authority to be able to handle tuition as they see fit.”


Is DOA skirting the law in sale of tobacco settlement?

Efforts by Gov. Bobby Jindal’s administration to sell the remainder of the state’s tobacco settlement for upfront cash appear to be moving forward quicker – and with less accountability – than state Treasurer John Kennedy would like. In an April 1  press release, Kennedy claims that the Division of Administration is trying to circumvent the state’s competitive bidding process in hiring advisors for the sale:


“We’re about to plunder our last savings account by selling the remaining portion of the tobacco settlement and spending the money. Even worse, we’re going to ignore state law and steer millions of dollars in fees to a group of people handpicked by the Division of Administration,” said Treasurer Kennedy. “I wish this was an April Fool’s Day joke, but it’s not.” Instead of following state law, the Division of Administration is moving forward with hiring advisers next week to seal the deal through a hastily called meeting of the Tobacco Settlement Financing Corporation. The corporation’s members are appointed by the governor, who made key appointments the Friday night before a Tuesday vote on the first process in the settlement sale. The hiring also is being done without following the competitive bid process that ensures taxpayers receive the lowest price for services.


Film credit bills are piling up

By now it’s become clear to just about everybody that Louisiana’s film subsidies are an expensive drain on state resources with a high potential for fraud and abuse. So the program’s chief supporters are doing everything they can to keep critics at bay by proposing reforms. The Advocate’s Marsha Shuler has a helpful roundup of 11 bills filed by state Sen. J.P. Morrell of New Orleans, who has emerged as the program’s chief protector. Among them:



  • Authorize contracts for tax credits for five years, renewable for five more years, for scripted television-video series if they agree to construct or lease production facilities in Louisiana. An agreement would also have to be struck with Economic Development on guaranteed expenditures and jobs for Louisiana residents.
  • Require sworn affidavits of those submitting information for the creation of production audit reports for tax credits; regulate and limit production expenditures among related parties.
  • Require the Louisiana Workforce Commission to provide information to Economic Development and the state Revenue Department to verify payroll and employment of Louisiana residents for purpose of the tax credit.



Morrell’s legislative package also calls for a $300 million annual cap, which needs to be lowered substantially to have any meaningful effect on state movie spending.


Candidates are short on tax specifics

The irrepressible Jim Beam of the Lake Charles American-Press has been listening to the four gubernatorial candidates talk about “tax reform” – they’re all in favor of it – but is not impressed by the lack of details.


During a stop in Lake Charles recently, (U.S. Sen. David) Vitter said he would see that a new Interstate 10 bridge would be built over the Calcasieu River. With a $12 billion road and bridge backlog in this state and other bridges in bad shape, that sounds like a campaign promise that is going to be difficult to keep. None of the four candidates have produced anything close to a revenue plan designed to repair the tremendous financial damage the Jindal administration and the Legislature have done to this state. Citizens shouldn’t have to wait until one of them is elected to find out what they have in mind. Maybe they should do what legislators are planning to do to solve the $1.6 billion shortfall at their session beginning April 13. They sound as if they are going to dump the problem in the lap of Senate President John Alario, R-Westwego, the longest serving member in the Legislature.


Number of the Day:


$12.3 billion:  The backlog of transportation infrastructure projects in Louisiana (Source: The Advocate)