Special session ends with budget, but without taxes to fund it

Posted at 11:42 PM, Jun 04, 2018

UPDATE, 12:30 a.m.: Governor John Bel Edwards is speaking about the lack of funding for the budget in a post-session press conference.


UPDATE, Midnight: The special legislative session has ended with a budget, but without any funding for that budget. Rep. Alan Seabaugh, R-Shreveport, ran out the clock by speaking in opposition to a re-vote on Rep. Lance Harris’ House Bill 12.

The House approved the Senate’s version of the budget with about 15 minutes remaining in the session.  However in the final few minutes, the House voted down two sales tax propositions that would have funded that budget. Because of the lack of funding, the budget will require deep cuts across agencies to be balanced.

Rep. John "Andy" Anders, R-Vidalia, had harsh words for his colleagues has he moved for sine die.

"I’m really disappointed in the whole process," Anders said. "When you get home, you think about what you’ve done and think hard on the way home."

Governor John Bel Edwards is expected to call another special session.  It would be the third of the year and the seventh since he and this legislature took office in 2016.


Associated Press

BATON ROUGE, La. (AP) – Louisiana lawmakers reached the final hours of a special session Monday still trying to broker a final deal on taxes and spending that could avoid both deep cuts and a government shutdown for the new financial year only weeks away.
Senators passed a $29 billion budget proposal that relies on $540 million in additional taxes for the financial year that begins July 1. House lawmakers backed a lower spending plan that assumed $400 million in taxes.
Lawmakers were uncertain whether they would settle the disagreement by Monday at midnight, when the special session must end. An earlier special session on taxes in February ended in partisan stalemate.
Gov. John Bel Edwards, who called the session, had wanted lawmakers to replace $648 million in temporary taxes expiring July 1. But acknowledging he won’t win support for the full amount in the Republican-led Legislature, the Democratic governor backed the Senate proposal.
"Obviously it’s not everything that I asked for," he told supporters. "But it is a really decent resolution to the budget problems we have."
Still, some factions dug in their heels in opposing different parts of the proposals under negotiation.
Rep. Tanner Magee, a Houma Republican, opened the House with the "Hail Mary" prayer, telling his colleagues he chose that selection because "we might need a miracle."
Lawmakers were in their sixth special session since Edwards took office in 2016, all of the sessions involving Louisiana’s continuing financial problems, which have stretched over a decade. And if they don’t reach a deal, they could be facing a seventh one.
Nearly $1.4 billion in temporary taxes, mainly sales taxes, passed by lawmakers in 2015 and 2016 are expiring when the new financial year begins. Increases in other tax types lessen the gap, leaving Louisiana estimated to bring in $648 million less in general state tax dollars next year.
The centerpiece of tax negotiations involves the expiration of a 1 percent sales tax hike enacted two years ago that would drop the state sales tax rate to 4 percent in July. The House voted to renew one-third of the expiring tax, to have a sales tax rate of 4.33 percent on July 1. The Senate backed a 4.5 percent rate.
The difference is 17 cents in sales taxes on every $100 of spending.
The two chambers also disagree on the level of sales tax exemptions to continue. And Democrats, particularly members of the Legislative Black Caucus, want a tax break program for the working poor expanded to offset some of the sales tax’s impact.
Both the House and Senate have agreed to scale back an individual income tax break that Louisiana allows for taxes paid to other states, but a final bill version must be worked out before it can reach the governor.
In the Senate version of the budget, college campuses and the TOPS tuition program would be protected from reductions, along with major health programs and the child-welfare agency. Corrections officers would get a pay raise. Need-based aid for college students would grow. The foster care program would be expanded to pay for students to finish high school or until they reach age 21, rather than ending payments when a child turns 18. Some places would take small cuts.
If enough taxes aren’t passed by lawmakers, certain portions of the bill would take pro-rata, across-the-board cuts. Those reductions would hit TOPS, college campuses and an array of departments, but health services would be shielded.
The House version of the budget would force larger cuts, shrinking TOPS awards by 10 percent and health spending. Health officials said they would have to heavily reduce or eliminate substance abuse and mental health services.
Edwards vetoed an earlier version of the budget that reached his desk, saying the cuts were too catastrophic to enact.
House Appropriations Chairman Cameron Henry said if all the tax bills fail, he wants lawmakers to enact a spending plan containing cuts.
"We still need a budget," the Republican told House lawmakers. But he added: "That’s the worst-case scenario."


UPDATE, 11:57 p.m.: The House has voted down Rep. Lance Harris’ (R-Alexandria) bill creating a six-year, one-third cent sales tax that would have partially funded the budget.  The vote died by a 38-66 vote.


With less than 30 minutes remaining in the special legislative session, the House has killed a Senate bill that would have raised revenue to fund TOPS, health care, and other items facing cuts if the state doesn’t fill a projected $647-million budget gap.

The House voted 64-41 for the bill, but it needed 70 votes to carry.

Rep. Cameron Henry, R-Metairie, is now bringing up HB 1–the budget bill–to the floor despite not having any funding for it.  Rep. Walt Leger, D-New Orleans, is asking lawmakers to approve the budget and then spend the final few minutes of the session voting on ways to fund the budget.