Wednesday, April 29, 2015

Wednesday, April 29, 2015

House committee caps film subsidies; Medicaid expansion may be inevitable; Cigarette tax watered down and; WISE funding gets green light

House committee caps film subsidies

Three bills that seek to cap the taxpayer subsidies to Louisiana’s film industry moved out of the House Ways & Means Committee Wednesday. House Bill 829 by Joel Robideaux of Lafayette provided the most generous cap at $226 million a year – the current level of funding. HB 704 by Ledricka Thierry of Opelousas puts the cap at $150 million and House Bill 276 by Rep. Lance Harris of Alexandria was amended to a cap of $200 million a year (the original bill would have capped credits at $130 million this year and slowly phase out the program altogether). As Tyler Bridges of the Advocate reports:

 

Harris told committee members that every dollar spent on the tax credits is a dollar not spent on the state’s colleges and universities, which are facing significant state funding cuts this year.

“We’re having trouble filling the holes,” Harris said. “We have to discuss issues like this that are not comfortable to vote on.” Harris also questioned the wisdom of continuing to subsidize an industry that supporters say would leave the state if the Legislature ended the tax breaks.

“It’s kind of like a 40-year-old son who won’t get out of the house,” Harris said. “It’s a subsidy that lasts forever.” About 68 percent of the tax credits awarded from 2009-14 were for movies and television shows filmed in New Orleans, while about 10 percent each were filmed in Baton Rouge and Shreveport, according to an analysis by the Louisiana Budget Project.

“It’s a spending program primarily for the New Orleans area,” said Jan Moller, who is the group’s director. He called for a $150 million cap on the tax credits.

 

Medicaid expansion may be inevitable

The Louisiana Hospital Association and several lawmakers believe that Medicaid expansion may be one of the key ways to fill Louisiana’s $1.6 billion dollar budget hole – not to mention the fact that it will provide health care coverage to nearly 300,000 uninsured people who live below 138 percent federal poverty level. Nola.com reports that all 4 candidates for governor have indicated they will support Medicaid expansion in some fashion, but waiting until 2016 means missing out on the federal government footing the entire bill and leaving many of our most vulnerable citizens uninsured. Several Medicaid expansion bills will be heard in the House Health and Welfare Committee today. As Rebecca Catalanello reports:

 

Not passing it now means Louisiana is rejecting the opportunity to insure a huge swath of its neediest people while denying health care providers the opportunity to receive compensation when these people show up in their emergency rooms and clinics in need of care. Already, a study showed that people who live in expansion states are receiving earlier diagnosis and treatment for potentially life-threatening diabetes than those who are not in expansion states. (Louisiana’s diabetes rate of 11.5 percent is the second highest in the nation, according to the U.S. Centers for Disease Control.) The federal government has offered to compensate expansion states at 100 percent for the first three years through 2016. If Louisiana sits out another year, it will have missed out on those fully compensated dollars and will opt in just as the state is required to kick in a little bit. By 2020, the federal contribution will still amount to at least 90 percent of the cost. That’s compared with the roughly 62 percent it pays now for traditional Medicaid in Louisiana.

 

Cigarette tax watered down

The Lafayette Advertiser is not happy that legislation to raise Louisiana’s cigarette tax was watered down by a House committee this week. Rep. Harold Ritchie’s House Bill 119 started out as an effort to raise the tax by $1.18 per pack, to the national average of $1.54. But the committee lowered the amount to 32 cents per pack.

 

These early weeks of the legislative session show lawmakers are timid about making the hard choices needed to close the $1.6 billion budget problem. Monday’s vote was a missed opportunity to mend the budget and improve Louisiana’s health. Louisiana needs bolder strokes by its state leadership, not half-steps, if the state is going to avoid a budget train wreck. This budget shortfall threatens the financial viability of our state universities and threatens the well-being of our healthcare system; neither higher education nor healthcare enjoys constitutional protections during budget shortfalls. The well-being of healthcare and education is far more important than the price of cigarettes.

 

WISE funding gets green light
According to the Advocate, university officials have been notified that federal grant dollars meant for hurricanes Gustav and Ike recovery can be used for the Workforce Investment for a Stronger Economy Fund, or “WISE” fund. The fund is intended to help fund university programs in high-demand fields and encourage partnership with the business community.

 

Gov. Bobby Jindal’s executive budget recommendation for the coming year includes about $30 million to continue the WISE Fund efforts, though higher education leaders have been bracing for deep cuts to funding. Jindal had been a key supporter of the fund’s creation last year. Sandra Woodley, president of the University of Louisiana System, said that even if the funding goes away in the coming year, she has seen value in higher education leaders coming together with workforce leaders to address the state’s needs.

 

Number of the Day

$240 million – the amount of money that would be generated for next year’s budget by a $1.18 tax increase on a pack of cigarettes (Source: Legislative Fiscal Office)