Louisiana lawmakers enter third tax session

BATON ROUGE, La.— Louisiana lawmakers have spent an unusual 45 weeks in legislative sessions since their term began in January 2016, and now they’re heading back for more, unable so far to reach a deal for financing state government programs starting in July.

Monday’s latest gathering is the seventh special session called by Gov. John Bel Edwards since he took office, all to deal with Louisiana’s ongoing financial instability— top of the annual regular sessions that lawmakers hold each year.

At issue this time, as it has been for two earlier special sessions this year, is whether lawmakers will replace expiring sales taxes they enacted in 2016 to patch budget gaps or instead allow deep cuts across state agencies.

SESSION DETAILS

Edwards called the 10-day session to begin Monday at 4 p.m. He speaks to the House and Senate at 5 p.m., hoping the urgency of the ever-nearing “fiscal cliff” will rally the votes necessary to pass taxes. Otherwise, he says damaging cuts will fall on public safety, education programs, and other government services.

The Democratic governor set limited parameters for a session expected to cost between $50,000 and $60,000 a day. He’s allowing lawmakers to consider sales taxes and certain budget items, but nothing else.

The session is supposed to end no later than 6 p.m. on June 27.

THE BUDGET GAP

Nearly $1.4 billion in temporary taxes are expiring with the July 1 start of the budget year. Though rising revenue from other tax types is replacing some expiring taxes, Louisiana is forecast to take in $648 million less in general tax dollars than it received this year.

The temporary taxes were planned as a bridge to a larger rewrite of Louisiana’s tax laws that never happened, blocked by House Republican leaders.

Edwards called two special sessions this year aimed at replacing some expiring taxes. The first ended in a partisan stalemate in the House, with no taxes passed. The second raised nearly $34 million in taxes for the shortfall, but agreement on a larger sales tax measure collapsed in the House in the final minutes of session.

LINES OF DISPUTE

Tax negotiations center on a 1 percent sales tax that is expiring and will drop the state sales tax rate to 4 percent in July.

The Senate agreed to renew one-half of the expiring tax, to have a 4.5 percent sales tax rate on July 1. House lawmakers disagreed on the last day of session, with a bipartisan majority supporting a 4.5 percent rate and House GOP leaders pushing a 4.33 percent rate that garnered less support. Neither proposal reached the twothirds vote required.

Edwards supported the Senate version, which raised less money than he wanted.

Some House Republicans are floating a 4.4 percent rate as a compromise. Closeddoor meetings are ongoing between the governor’s office, House and Senate trying to broker an agreement.

THE CHOPPING BLOCK

The budget passed by lawmakers and signed by Edwards will slash spending in July across most agencies outside of health services if no additional dollars are raised.

The TOPS program will cover about 70 percent of tuition costs. College campuses will take new cuts after a decade of reductions.

Public safety programs will be slashed. The Edwards administration says Louisiana’s food-stamp program will be eliminated and thousands of prisoners will be released early.

Conservative House Republicans say the impacts are overexaggerated scare tactics trying to box lawmakers into tax votes.

It’s unclear how much flexibility lawmakers have under the tight parameters for the special session to shuffle dollars in next year’s budget.

Lawmakers so far have shielded legislative and judicial agencies from cuts, even as those agencies appear to be sitting on millions in unspent funds.