Into the home stretch

Into the home stretch

Louisiana legislators return from the Memorial Day break with little more than a week left in which to broker a compromise between the House and Senate on the $28 billion state budget.

Number of the Day

$56.5 billion - Increase in disposable personal income in April, over the previous month - an increase of 0.4 percent. (Source: Bureau of Economic Analysis)

Louisiana legislators return from the Memorial Day break with little more than a week left in which to broker a compromise between the House and Senate on the $28 billion state budget. The AP’s star reporter, Melinda Deslatte, breaks down how the House version of the budget would cripple health, higher education and corrections services. But neither side seems inclined to budge:

Appropriations Chairman Cameron Henry, a Republican who had a heavy hand in drafting the House version, predicted agencies would tell lawmakers “the world’s going to fall apart” under the scaled-back spending plan. But he said he didn’t believe that was true. Edwards replied that without the money, health services, the child welfare agency and prisons would face unnecessary, harmful cuts. The Senate Finance Committee is expected to unveil senators’ version of the spending plans this week. Chairman Eric LaFleur, a Democrat, said senators of both parties want to add more money into the spending plan, but he said he’s also been told by House Republicans that tapping into the unspent dollars is “a deal-breaker” for them.

The members of the Senate Finance Committee, who will put their imprint on the budget bill this week, spent nearly eight hours on Saturday hearing testimony from members of the public about the impact of budget cuts. The Advocate’s Mark Ballard:

Most witnesses described their daily struggles from handling family members with disabilities, mental health problems and seniors – often passing back and forth a box of tissues placed on the testimony table by Senate staff. Susan Smith, from Walker, detailed the problems trying to find supportive housing for her autistic son and, having found nothing in Louisiana, coming to grips with the possibility of having to move him to another state.

The main job facing lawmakers this session was to reform Louisiana’s broken tax structure. But as The Advocate’s Tyler Bridges reports, lawmakers virtually ignored a series of detailed reform recommendations and may, instead, be making things even worse.  

In fact, lawmakers are in the process of approving at least two dozen tax exemptions pushed by lobbyists that would benefit specific industries or even individual companies. In most instances, members of the House Ways and Means Committee, Republicans and Democrats alike, have faced no questions from their peers while pushing through the new breaks. It’s exactly the opposite of the vision laid out by the Task Force on Structural Changes in Budget and Tax Policy — which consisted of economists, good-government officials, a mayor, a union leader, tax lobbyists and others.

 

Reneging on a promise

President Donald Trump’s budget proposes to take away roughly $140 million per year in offshore oil and gas royalties that Louisiana is slated to receive starting next year. The royalty agreement was negotiated in 2006 by then-Sen. Mary Landrieu, and the money is supposed to help fund the state’s coastal master plan. Nola.com/The Times-Picayune has more:

In his budget proposal, President Donald Trump calls for killing the Gulf of Mexico Energy Security Act. He argues that the royalties promised in the act would benefit “only a small handful of states …. despite federal waters belonging to all Americans.” President Obama’s budget director said almost exactly the same thing in 2015. That reasoning is badly flawed. Gulf states have borne the infrastructure and environmental costs of supplying the nation with energy for decades while the federal government took all the royalties paid by oil and gas companies. Between 1949 and 2006, the payments totaled $160 billion.

 

Rural America is the new inner city

It wasn’t that long ago that America’s inner cities were considered the country’s epicenter of social ills such as poverty, crime and economic stagnation, while rural areas were thought to be safe and relatively prosperous. But as Janet Avaby and Paul Overberg of The Wall Street Journal document in an eye-opening investigation, that has changed dramatically in the past 30 years.

In terms of poverty, college attainment, teenage births, divorce, death rates from heart disease and cancer, reliance on federal disability insurance and male labor-force participation, rural counties now rank the worst among the four major U.S. population groupings (the others are big cities, suburbs and medium or small metro areas). In fact, the total rural population—accounting for births, deaths and migration—has declined for five straight years. … Just two decades ago, the onset of new technologies, in particular the internet, promised to boost the fortunes of rural areas by allowing more people to work from anywhere and freeing companies to expand and invest outside metropolitan areas. Those gains never materialized. As jobs in manufacturing and agriculture continue to vanish, America’s heartland faces a larger, more existential crisis. Some economists now believe that a modern nation is richer when economic activity is concentrated in cities.

 

Searching for Medicaid fraud

Some conservative members of the state House seem to have convinced themselves that Louisiana’s Medicaid budget is riddled with fraud, and that reining it in is key to reducing state spending. The Advocate’s Elizabeth Crisp does some poking around and discovers that Louisiana does a better job than its neighbors in recovering money from healthcare providers that rip off state taxpayers.

Each year, Louisiana is recognized as one of the top states in investigating, prosecuting and ultimately recovering Medicaid money that has been misspent. Medicaid fraud is used as a catch-all term to refer to ways that providers – medical professionals and others who bill for Medicaid services – will charge more to the program than they should. Most commonly, it includes billing for services that were never provided, over-inflating costs and bribing third parties for kickbacks.

 

Number of the Day

$56.5 billion – Increase in disposable personal income in April, over the previous month – an increase of 0.4 percent. (Source: Bureau of Economic Analysis)