A brighter budget picture

A brighter budget picture

Louisiana legislators will have an extra $677 million in tax revenue available to spend over the next 13 months, thanks largely to an uptick in economic activity due to the influx of federal recovery dollars. The updated forecast from the Revenue Estimating Conference comes as the Senate prepares to take up a package of budget bills covering the remainder of the current fiscal year and the fiscal year that starts July 1. As always, Melinda Deslatte of the AP was there:

The Revenue Estimating Conference increased the estimate for general state tax collections in the current budget year that ends June 30 by $357 million. The panel also increased the general fund forecast for the upcoming budget year that begins July 1 by $320 million. Those dollars aren’t currently included in the budget legislation awaiting decisions in the Senate, but senators will add it in the coming days. Spending ideas for the money abound, with suggestions ranging from increased teacher pay raises and more dollars for early childhood education programs to paying down a variety of state debts.

Reality check: The extra revenue is welcome, and provides a rare opportunity to make long-needed investments in low-income communities across the state. But the unprecedented flow of federal dollars propping up Louisiana’s budget – and the broader economy – is only temporary. Next year’s budget is being helped by a one-time bump in the Medicaid match rate. The enhanced federal payments for unemployment benefits and the expanded child tax credit are due to expire by the end of this year. And the $3.2 billion Louisiana received as part of the American Rescue Plan Act must be spent by the end of 2024. Lawmakers should not see this money as an excuse to avoid the hard, but necessary work of reforming Louisiana’s tax structure to secure adequate revenue for Louisiana’s critical needs.

Covid-19 and child care 
The Covid-19 pandemic created profound changes in how schools, the economy, and the workforce operated. While the pandemic affected people across the economic spectrum, Covid-inspired changes hit women – many of whom bore the responsibility of taking care of children while trying to make ends meet – the hardest. Claire Cain Miller of the New York Times writes about how the pandemic created a child care crisis in America and how mothers have borne the brunt of this challenge. 

A new survey by Morning Consult for The New York Times — of a representative group of 1,001 mothers nationwide who were working for pay before the pandemic began, including 448 who quit — found that 60 percent of those who quit were satisfied with their decision. Another 20 percent had considered quitting for child care reasons. But that doesn’t mean it’s what they would have chosen if they had options. Eighty percent said they were the only parent who considered quitting — their partner did not. Employment fell more sharply for those without college educations or high incomes; for those whose jobs couldn’t be done from home; and for those who are Black or Latina. But the biggest difference between mothers who kept working and didn’t, the survey found, was simply whether their children’s schools were open.

Biden can transform the social safety net
Social safety net programs are critical for helping people in times of need and for redressing long standing inequities, but America’s safety net doesn’t catch all of the people it should. In particular, benefits like the Earned Income Tax Credit and the Child Tax Credit miss many of the people who would most stand to benefit, because they don’t earn enough to be required to file taxes. But the new emergency expansion of the child tax credit changes how families in need receive that support by giving them direct monthly payments instead of a lump-sum tax refund. Boston Review’s Ben Zdencanovic has more on how the American Rescue Plan direct payments can change the way we structure support for people.

We need to reckon with the legacy and limitations of trying to pursue social policy through the back door of taxation, instead of through the front door of direct services. The changes to the child tax credit under the American Rescue Plan are a step in the right direction—toward a welfare state that dispenses benefits as a universal right of citizenship rather than mystifies them through an inequitable tax code. Extending the changes to 2025 via the American Families Plan would help, but removing the expiration date—making it harder for Republicans to overturn them—would be even better.

Providing a better environment for foster children 
Legislation that would create a “bill of rights” for teen foster children is moving closer to final passage in the state Legislature. Senate Bill 151 by Sen. Regina Barrow aims to create a more secure home life for foster children, something that many do not experience after leaving their biological family. The Louisiana Illuminator’s JC Canicosa reports:. 

If passed, SB 151 would establish the “Foster Youth’s Bill of Rights” — including the rights to receive an education, religious freedom, privacy, freedom from discrimination and freedom of expression — for teens ages 14 through 18 in foster care throughout the state. The bill also allows foster youth the right to attend all court hearings regarding their care and “participate in all case plan meetings,” according to the legislation. … “We have to ask ourselves, are we providing for (foster youth) a better environment than the one they were removed ? Are we stripping them of the same normalcy, rights and love that they may have lacked in their biological homes?” (former foster child Alliyah) Zeren asked. “It’s up to us to make a difference and this ‘Foster Youth’s Bill of Rights’ will do exactly that.”

Number of the Day
$90 million – Amount of additional federal funding for Medicaid home- and community-based services that Louisiana will receive through the American Rescue Plan Act. This funding can help Louisiana seniors and people with disabilities receive services in their communities rather than in nursing homes. (Source: Kaiser Family Foundation)