Gov. John Bel Edwards’ reforms to Louisiana’s lucrative Industrial Tax Exemption Program (ITEP) have had a major impact on some local government budgets. Together Baton Rouge reports that manufacturing corporations have paid more than $116 million in property taxes to local authorities for things like schools, roads and police protection. Without the reforms, that property would have been exempt from taxation. Stephanie Riegel of the Greater Baton Rouge Business Report has the details:
For East Baton Rouge Parish in particular, the analysis suggests local governmental entities have realized more than $10 million in new revenues by denying certain ITEP applications. Of that amount, $5 million has gone to East Baton Rouge Schools, $1.5 million to the East Baton Rouge Parish Sheriff’s Office, $1.4 million to BREC, $1.1 million to the library system, $900,000 to EMS and mental health services and $900,000 to city-parish government.
Disclosure: Executive Director Jan Moller is a member of the Board of Commerce and Industry, which oversees the ITEP.
Coronavirus brings (some) uncertainty to state budget
The plunge in global oil prices – and the economic slowdown caused by the burgeoning coronavirus pandemic – are likely to have a disruptive effect on Louisiana’s state budget. Every $1 drop in the price of a barrel of oil means a loss of about $11 million in state revenues. The good news: Louisiana is far less dependent on oil revenue than in years past. Sam Karlin of The Advocate reports that state economists, for now, are taking a wait-and-see approach:
Still, with tax revenues set to grow in other areas, the oil crash may not require lawmakers to make cuts. Greg Albrecht, the chief economist for the Legislative Fiscal Office, said the falling oil revenues could be offset by other tax revenues that are growing. “Does that change the entire revenue forecast? I don’t know that yet. It does hit mineral revenue,” Albrecht said. “But we have some other pluses that are sizable numbers. But if those stay up I’m using that buffer there to pay for that mineral weakness.”
Columnist Stephanie Grace wonders if the rapidly unfolding economic events could change some political assumptions:
It’s too soon to say whether oil prices will bounce back, but if not, the drop could put a hole in both the state budget and the economy. A severe tourism slowdown could devastate New Orleans. Any sort of economic downturn is bound to expose holes in the safety net and create pressure on the generally conservative Legislature to do more to help Louisiana’s most vulnerable citizens; paid sick leave is certainly one item that could be considered.
Target economic relief to those who need it most
When a public health crisis hits, low wage workers are often hit the hardest – impacting those least likely to have access to paid sick days and least likely to be able to take unpaid time off from work. Far too often, black and brown communities are affected more than others. Amy Hanauer of the Institute on Taxation and Economic Policy offers a series of economic interventions that could quickly help those who need it most:
We should expand unemployment insurance, eliminate work requirements and ease access to basic safety net programs, and require employers to offer paid sick days (…). Providing rebate checks to all adults and children would be better targeted and more equitable than the payroll tax cut that the Trump administration is pushing. A payroll tax cut delivers fewer benefits to poorer families, is less targeted to those who lack paid time off and can leave out people who lose their job because of the downturn. This makes it both less fair and less helpful to the economy.
Invest in communities to save lives
Gun-related deaths in Louisiana rose more than 18% from 2009 to 2018, making the Pelican State the fifth-worst state for per-capita gun violence. These deaths disproportionately affect minority communities, including black women ages 20-34 who suffer gun-related homicide at a rate more than 5.5 times that of their white female counterparts according to a recent report by Educational Fund to Stop Gun Violence. (This alarming statistic is made even more urgent when considering a recent study by JAMA Pediatrics that finds homicide is a leading cause of death for pregnant and postpartum women.) Fritz Esker of The Louisiana Weekly has the story and how investments in communities can help save lives:
“A lot of people, especially policy makers, want that one special fix…For homicides, there isn’t one quick solution,” (Dakota) Jablon (director of federal affairs for the Educational Fund to Stop Gun Violence) said. “There are a lot of root factors contributing to homicides.” Jablon said added green space in neighborhoods, more employment opportunities, and cognitive behavioral therapy can reduce homicide rates.
PSA: The Census 2020 website went live with a soft-launch this week. You can complete your Census 2020 form online now using your address or wait for an official paper notice with an ID code that will be mailed out this week. This once-in-a-decade count not only determines how billions of federal dollars are allocated to states, but also forms the basis for redistricting maps in 2021. Be sure to be counted!
Number of the Day
222,941 – Number of Louisiana workers who don’t have access to paid sick days and earn below $34,999 per year. (Source: Institute for Women’s Policy Research)