Gov. John Bel Edwards opened his sixth special session as governor Tuesday with an address to an estimated 1,100 supporters at the University of Louisiana at Lafayette. With the Legislature bitterly divided over the state budget and tax policy, Edwards urged policymakers to come together around solutions for the $648 million fiscal cliff that will force deep cuts to health care and other programs if unaddressed. Edwards said he is open to new ideas beyond the tax proposals he has already laid out. The only idea he stated he isn’t open to is doing nothing. The AP’s Melinda Deslatte reports:
The governor’s plan mainly involves sales taxes. He supports renewing up to half the 1 percent sales tax expiring in six weeks, to raise more than $400 million a year. He also backs permanent removal of some sales tax breaks and the continued charging of sales taxes on business utilities. But Edwards said he’s open to other tax ideas lawmakers might have. Edwards frames the plan as a net tax reduction because Louisiana residents still would pay less next year. Critics disagree, saying any renewal would constitute a tax hike.
A few Republicans attended the speech, but House leaders expressed disappointment in the whole event even as they lack a plan for solving the state’s budget gap. Julia O’Donoghue of Nola.com| Times Picayune:
The event was attended by a handful of Republican legislators, mostly from the immediate Lafayette area, and many more Democratic lawmakers. Members of the governor’s cabinet and lobbyists also made the trip from Baton Rouge to Lafayette for the speech. “Today’s political theater will not change our priorities of working on behalf of Louisiana taxpayers in this special session,” [House Speaker Taylor] Barras said in a video the House Republican Caucus released Tuesday afternoon.
Any revenue plan will need nearly unanimous support from the Legislative Black Caucus. While caucus members have long been opposed to raising sales taxes, which hit low-income families the hardest, some are now willing to accept a partial renewal of the sales tax if other conditions are met. Drew White and Paul Braun of the LSU Manship School News Service in the Daily Advertiser reports:
“I believe that if we are going to vote for a sales tax, we need to have certain provisions in place to protect these very fragile people,” Rep. Ted James, D-Baton Rouge said to the town hall crowd. James said in an interview that caucus members might propose an increase in the earned income tax credit, which could help offset $10 million or more of the extra sales tax burden on poorer residents.
To get the basics on the special session, click here for an overview and an explanation of the major revenue proposals by LBP. Key bills to watch:
House Bill 6, by Rep. Walt Leger III. Doubles Earned Income Tax Credit from 3.5 percent to 7 percent.
House Bill 11, by Rep. Terry Landry. Retains .5 percent of the expiring sales tax and removes exemptions from the permanent 4 percent sales tax.
House Bill 23, by Rep. Ted James. Retains .75 percent of the expiring sales tax and dedicates money for TOPS, teacher pay raises, early childhood education and Go Grant scholarships.
House Bill 24, by Rep. Ted James. Increases Earned Income Tax Credit from 3.5 percent to 10 percent.
Child care must be a priority
Jenna Conway, the assistant superintendent of education who oversees early childhood education, is leaving her post and returning to her home state of Virginia. But before she leaves, she has a message: There is no bigger challenge in early childhood education than reducing the backlog of 5,000 families who are waiting for subsidized high-quality child care. Will Sentell of the Advocate reports:
“We have all these working families trying to better the lives of their kids and we cannot find the way to make the investment,” said Conway, who is leaving her post June 1. The aid, called the Child Care Assistance Program, or CCAP, has been decimated by state budget cuts since 2008. The program helps pay for the cost of child care for children from birth to age 4 while moms and dads are at work, school or in job training. However, enrollment has sunk from about 39,000 children in 2008 to 15,154 today amid recurring state budget problems. A total of 5,280 children are on the CCAP waiting list, according to the state Department of Education.
TOPS contingency plans
The TOPS scholarship program is at the front of the list of budget items that could get cut if lawmakers refuse to raise the $648 million needed to fix the fiscal cliff. In the meantime, high school students are voting with their feet, making plans to travel out-of-state if the legislature doesn’t fund the program. Jim Henderson, president of the University of Louisiana System argues in Nola.com/Times Picayune.
Many [graduates] are in the final stages of decision-making on their future, weighing lucrative offers from out-of-state institutions while nervously watching the progress at the Capitol. … The positive momentum on our campuses after just one year of stability is extraordinary. We have the highest enrollment in five years, our partnerships with community and technical colleges are flourishing, and our universities are working collaboratively under a system-wide strategic framework that promises all Louisianians a quality of life that has eluded us for decades. The economic, cultural and societal benefits of increasing educational attainment are immense. The Universities of Louisiana and our more than 91,500 students are worthy of investment. We aren’t asking for much — just a policy environment that recognizes the promise of our state and the role our universities play in reaching our potential.
Cuts will devastate hospitals
Louisiana’s fiscal crisis is threatening health care services in every region of the state, particularly those delivered by public/private partnership hospitals. Louisiana Hospital Association CEO Paul Salles writes in The Advocate that partner hospitals depend on federal dollars that require an adequate state match, and that there will be a significant impact on local economies if employees have to be laid off this summer.
If these cuts materialize, hospitals in some communities would have to substantially reduce services triggering thousands of employee layoffs. At a time when Louisiana is working to improve our state’s economy, these layoffs would be detrimental locally and have a negative economic ripple effect statewide. Patients and citizens risk losing access to primary care physicians and specialists in communities throughout the state. Many would find themselves seeking care in hospital emergency rooms, adding additional stress and costs to an already overburdened system. Because our medical education enterprises are financially and operationally tied to our teaching hospitals, these cuts would also substantially disrupt the education and training of physicians and other allied health care professionals, possibly forcing them to move out of state to complete their training.
Number of the Day
5,280 – Number of families on a waiting list for subsidized child care through the Child Care Assistance Program (Source: The Advocate)