Destabilizing the state budget

Destabilizing the state budget

A House committee voted without objection Monday to advance a tax plan that would destabilize Louisiana’s finances by cutting $914 million in projected sales tax revenue over the next five years. Rep. Lance Harris’ House Bill 599 would roll back 0.45% of the state sales tax, thereby unraveling last year’s hard-fought compromise that brought Louisiana’s budget back into balance after years of shortfalls. The Advocate’s Sam Karlin:

While the governor left himself open to supporting some smaller tax breaks being pushed by lawmakers, he said Friday during a press conference he won’t sign any “high-dollar” tax expenditure proposals. “Here we finally achieved some level of stability and the Legislature introduces a slew of new exemptions and so forth,” Edwards told reporters. “For the most part these are things we should not be considering at this point in time.”

Supporters of the tax cut currently have no plans to make up the lost revenue. This means policymakers would face two unpleasant choices if the tax rollback is successful: They could fill the gap using financial gimmicks and one-time revenue, which would merely postpone the fiscal reckoning. Or they could make cuts to state services, which would almost certainly hit health care and higher education the hardest. A similar plan has already been rejected by a Senate committee, making it unlikely that this measure will find its way to the governor’s desk.


Want to lift Louisiana’s rankings? Invest in the opportunity

U.S. News and World Report released its annual “Best States” ranking, with Louisiana at the bottom of the list for the third year running. The ranking has already become an election-year political football, with Gov. John Bel Edwards’s camp citing improvements that are not yet reflected in the report’s sources and his opponents laying the blame for the state’s low ranking at his feet. But one thing that’s clear from the ranking is that Louisiana’s failure to invest in the well-being of ordinary citizens continues to put the state at a disadvantage which no amount of corporate subsidies could make up. Louisiana ranked 43rd for fiscal stability and below 45th in all other categories. As the Advocate’s Elizabeth Crisp reports, poor performance in measures of equity and opportunity are the main factors driving the state down:

“As people are increasingly concerned about income disparities, rising health care costs, gaps in education and crumbling infrastructure, it’s more important than ever to focus on the day-to-day policies that affect people where they live their lives,” said Eric Gertler, executive chairman at U.S. News. “In conjunction with objective data and trusted journalism on state performance, the rankings fills the gap in local reporting for the benefit of residents, business leaders, decision-makers and government officials.”

LBP’s Invest in Louisiana campaign has some ideas for lawmakers looking to turn the state’s performance around.


The president comes to Cameron Parish

President Donald Trump visits Southeast Louisiana today for a tour of Sempra Energy’s new $10 billion natural gas export facility – one of several such facilities either built or underway along the Gulf Coast. The advent of hydraulic fracturing has dramatically lowered the price of domestic natural gas, giving rise to a fast-growing export market for energy-hungry overseas markets. While this has made Louisiana the nation’s leader in liquefied natural gas exports, The Advocate’s Anthony McAuley reports that many of the jobs that come with these massive investments are temporary:

Jim Richardson, professor of economics at LSU, says the new jobs are welcome and will spur indirect employment in their areas, although they won’t replace the jobs lost in the oil and gas sector over the last few decades. At its height in the late 1970s, the oil and gas sector employed over 100,000 people in Louisiana, Richardson said. About half the jobs were lost during the oil slump in the early 1980s and another 20,000 disappeared when oil prices tumbled starting in 2014, he said, noting that the industry employs about 35,000 people in the state today. “Nobody really expects that number to shoot up anytime soon,” even with the gas infrastructure growth, as it is much less labor-intensive, says Richardson.

The unprecedented corporate investments have yet to produce big gains for local governments, as the projects come with massive property-tax breaks. As The Advocate reported in 2017, Cameron Parish still struggles to pay for basic services such as schools and police officers.  


Key population still barred from Louisiana’s jury pool

People completing prison sentences in Louisiana face many barriers to full participation in civic life. And while the House voted Monday to advance House Bill 503 by Rep. Rick Edmonds, which makes it easier for people convicted of crimes to obtain occupational licenses, lawmakers also rejected another bill, House Bill 65 by Rep. Ted James, which would have allowed people who served their time for felony convictions to be eligible for jury service. Because Louisiana has long incarcerated black people at far higher rates than their white peers, the measure would have taken an important step toward reducing racial inequity in the courtroom. The Advocate’s Bryn Stole reports:

Under Louisiana law, those with a felony conviction remain ineligible for jury duty for life, with those granted a rare pardon from the governor the sole exception. State law allows those with felony convictions to run for public office after a five-year waiting period similar to what James proposed for jury service. James described the proposal as another step toward integrating those who’ve served their time back into society and “move beyond this idea of permanently punishing people that have been convicted of a crime.” James also repeatedly noted that those with convictions wouldn’t necessarily end up sitting on juries since both prosecutors and defense attorneys could still strike ex-felons while selecting a jury for trial.


Didja Know? Podcast 5-15

On this episode we’re talking to Rep. Royce Duplessis of New Orleans about his bill to lift the statewide preemption law that forbids local governments from setting their own minimum wage. Next we talk to Neva Butkus about what lawmakers can still do this legislative session to reform Louisiana’s antiquated tax code. She also discusses the 65th anniversary of the landmark case of Brown v. Board of Education and the segregation that still exists in public schools despite it. Finally, Jan Moller recaps the last few weeks of the legislative session and what we should be paying attention to as we enter the home stretch. Listen here.


Number of the Day

$100,000 – Minimum amount in tax revenue per person—including children—that Cameron Parish lost to corporate subsidies each year between 2011 and 2016. (Source: The Advocate)