Slow progress on revenue

Slow progress on revenue

The Louisiana House approved revenue measures worth a combined $222 million on Thursday before adjourning for the weekend. That’s less than one-half of what’s needed to maintain standstill funding for health-care, education and public safety services that are threatened by budget cuts.

The Louisiana House approved revenue measures worth a combined $222 million on Thursday before adjourning for the weekend. That’s less than one-half of what’s needed to maintain standstill funding for health-care, education and public safety services that are threatened by budget cuts. Most of the money – an estimated $190 million – will come from raising a tax on health insurers. As The Advocate’s Tyler Bridges reports, GOP legislators are under heavy pressure to vote against new revenues.

University presidents and representatives from K-12 schools, safety-net hospitals and the sheriffs’ association were spurned in their appeals to committee members to approve this and other income revenue-raising measures. Edwards had been especially hopeful of winning support from three of the freshman Republicans on the committee — Rep. Paula Davis, of Baton Rouge; Rep. Stephanie Hilferty, of New Orleans; and Rep. Stephen Dwight, of Lake Charles. Only Dwight voted for HB11. Baton Rouge businessman Lane Grigsby confirmed on Thursday that he met with Davis at the State Capitol on Wednesday to tell her in no uncertain terms that she should reject the tax measures. Grigsby has spent millions of dollars in recent years to push conservative causes in Baton Rouge.

 

Bruce Greenstein returns

Lawmakers looking for alternatives to raising revenues or cutting services have found a champion in a former state health secretary. Bruce Greenstein has been floating the idea that more Medicaid dollars can be drawn from the federal government – a notion the current administration refutes. The Advocate’s political columnist Stephanie Grace, notes the irony of a former Bobby Jindal appointee urging more savings from Medicaid expansion.

 

And can we talk for a moment about the irony that the idea is being circulated by one of Jindal’s health secretaries, Bruce Greenstein, whose power point on the subject is apparently making the rounds in conservative circles? Jindal, of course, rejected expansion, insisting until the end that largely federally funded expansion under President Barack Obama’s Affordable Care Act would be a financial loser for the state. Once in office, Edwards eagerly signed up, and his administration estimates the move will save $184 million next year alone. That’s a hefty number, even if Greenstein now says it could be higher…If Greenstein, who left office under a legal cloud, now thinks there’s so much money to be saved and if so many people could have been helped in the process, why again did Jindal refuse? Never mind. We all know the answer to that one.

 

Capital outlay bill moving
The Legislature is one step closer to passing its construction budget, which it  failed to do during the regular session. The Advocate’s Elizabeth Crisp reports the latest version that passed the House Thursday is similar to the Senate’s version, with a few extra House projects. Objections remain over the process and the politics.

Lawmakers in years past have frequently stuffed the construction bill with more projects than the state could fund. That left the governor in charge of what stayed and what got cut. Gov. John Bel Edwards has urged lawmakers to no longer put forward construction projects that have no chance of receiving funding from the Louisiana Bond Commission. Abramson admitted the latest version of HB2 remains bloated. “Whether we can pay for all this is another story,” he said. But he called the latest revision a “step in the right direction.” “We’re on the path toward right-sizing this,” he said. The construction budget, referred to as “capital outlay,” is important to legislators because it gives them a chance to send money back to their home districts for projects. Edwards, who called on lawmakers to curb their requests this year, has said he thinks the money available next year — estimated at $330 million to $500 million — should go toward road improvements and maintenance of state government buildings and buildings on college campuses.

 

Social immobility
Children born into rich families are likely be rich as adults. Children born poor are likely to stay poor.  That’s from a report by the Russell Sage Foundation, “Opportunity, Mobility, and Increased Inequality.” Thomas Edsall of the New York Times looks at the data and what it means:

 

If we focus just on the least well off, the United States today is moving toward “increasing inequality of opportunity,” with the gains over the past several decades for those in the bottom of the income distribution modest, at best, or non-existent. Katharine Bradbury and Robert Triest, economists at the Federal Reserve in Boston who are the editors of the report, which is called “Opportunity, Mobility, and Increased Inequality,” argue that when inequality of outcome stems from entrepreneurship and “differences in work effort,” the increase in inequality is justified and that therefore “no remedial changes in public policy are needed.” If, however, the increase in inequality results mostly from factors largely beyond the ability of individuals to control or counteract, then a strong case can be made for a public policy response…We have clearly come to that point. Timothy Smeeding, a professor of public affairs and economics at the University of Wisconsin, writes: “At least half of all bottom-quintile children who were African American, whose parents did not finish high school, or who grew up with a never-married mother, remained in the bottom quintile as adults. Three-quarters or more (74, 78, and 80 percent, respectively) ended up in the bottom 40 percent of the income distribution as adults, thereby failing to realize the American dream.”

 

Number of the Day

$378 million – the amount of money the House still needs to raise by June 23  in order to meet the state’s basic needs next fiscal year. (Source – The Advocate)