NewsCovering Louisiana


New leaders, same impasse: Louisiana forecast blocked again

Posted at 7:44 PM, Jan 31, 2020

BATON ROUGE, La. (AP) - Gov. John Bel Edwards' administration reached another impasse Friday over Louisiana's income forecast, unable to strike a deal with the Legislature's new Republican leaders about how to set the projections used to build the state's budget.

The Democratic governor had been hopeful that a change in the House's top leadership would break through repeated logjams over the forecast and give him the updated, larger state income forecast he wanted as he crafts his budget proposal for next year.

Instead, the Edwards administration found itself at odds with both the new Republican House Speaker Clay Schexnayder and new GOP Senate President Page Cortez during the latest meeting of the Revenue Estimating Conference.

Both Schexnayder and Cortez expressed concerns about the numbers proposed by nonpartisan legislative and administrative economists that Commissioner of Administration Jay Dardenne, the governor's chief budget adviser, wanted to use. Schexnayder proposed a significantly smaller set of increases to the forecast, calling it a way to keep "some conservative in the forecast."

"I think we're trying to find a sweet spot," said Schexnayder, of Ascension Parish. "No one gets everything they wanted, but we all get a little something."

Schexnayder was backed by Cortez, who called it a "reasonable middle ground" offer. But Dardenne refused, saying the estimates the House speaker proposed weren't crafted based on economists' advice.

"It's arbitrary," Dardenne said. He added that the panel "may as well not have our economists," if it won't listen to their guidance.

Dardenne backed a proposal that would have given the state another $170 million to spend in the current budget year and another $103 million to spend next year, the smaller of two forecast hikes proposed by economists that advise the conference. Schexnayder recommended raising this year's forecast by $94 million and next year's projections by $400,000, striking out the sales tax increases included in the economist's estimate.

Dardenne, Cortez and Schexnayder sit on the Revenue Estimating Conference with an independent economist, Stephen Barnes. Forecasting decisions must be supported unanimously. Barnes voted with Cortez and Schexnayder, for a 3-1 stalemate. Unable to reach a deal Friday, the conference wrapped up its work at a deadlock, just like at its previous meeting.

Former House Speaker Taylor Barras, who was term-limited and left the job earlier this month, had repeatedly blocked forecast adjustments sought by Edwards over the last year.

Though a new forecast wasn't adopted, Dardenne said the governor will give lawmakers a budget proposal for the upcoming 2020-21 financial year based on the increases he wanted. Those spending recommendations will be released on Feb. 7.

"It is my hope that Senate President Page Cortez and House Speaker Clay Schexnayder will act in the near future to approve a forecast by one of the state's two economists that will allow us to have a fruitful discussion of our spending priorities," Edwards said in a statement.

Schexnayder said he was surprised Dardenne refused his proposal.

"This was reasonable, I thought," Schexnayder said.

Cortez, of Lafayette, had raised concerns about Dardenne's support for a forecast proposal that includes $25 million locked in a dispute with Treasurer John Schroder. Schroder, a Republican, has refused to transfer the dollars from the state's unclaimed property account to spend on general operating expenses - even though lawmakers appropriated the money in the budget.

Cortez said while he agrees with the Edwards administration that the treasurer has exceeded his authority, he doesn't believe the state should spend money that could be tied up in litigation. Dardenne said Friday the governor intends to sue Schroder over the blocked fund transfer.