Louisiana lawmakers have until midnight Thursday, June 23, to conclude the second special session of 2016. They have been meeting more or less continuously since Feb. 14, and by now they’re pretty much tired of looking at each other.
But their work is far from done, according to Gov. John Bel Edwards, who summoned them into both special sessions and is said to be considering yet another — yes, a third
— if this one doesn’t meet his expectations.
The governor wants lawmakers to boost state revenue by $600 million in the current session. Most lawmakers, including many who support Edwards, say the state could get by with $300 million to $450 million. By either count, the state is still short.
The more conservative (and much more partisan) House thus far has approved only $220 million in tax increases. The Senate, which tends to side with whoever is governor, has approved about $400 million, which includes the House-passed measures.
To make matters worse, leges and Edwards learned this week that business tax collections were at least $200 million shy of projections in May. If those numbers continue into June (the last month of the fiscal year), state agencies will face even deeper cuts starting July 1.
Theoretically, the shortfall in corporate tax collections puts pressure on tax-averse House members, but Speaker Taylor Barras, R-New Iberia, says his colleagues have reached the “saturation point” on taxes. We’ll find out in the next few days if that’s true. House members are set to consider two significant tax proposals in the coming days:
• House Bill 38
by Rep. Melinda White, D-Bogalusa, would reduce — for two years — the percentage of excess federal itemized deductions individual taxpayers could claim on their state returns. White’s original bill called for a permanent reduction, but she agreed to make it temporary to get the measure to the House floor. It is now described as a two-year taxpayer “loan” to the state, but it creates a $257 million fiscal “cliff” in 2018.
• Senate Bill 10
by Sen. Rick Ward, R-Port Allen, would force large companies to choose between two major tax breaks: the inventory tax credit and the industrial property tax exemption. Under Ward’s bill, they could get one but not both.
There’s no guarantee either measure will clear the House, but Ward’s bill is considered more palatable because it would hit big corporations rather than individuals.
The Louisiana Association of Business and Industry
(LABI) is working overtime to kill Ward’s bill and other business taxes. Edwards is hoping to rally lawmakers behind TOPS, higher education and public hospitals — all of which face deep cuts unless lawmakers approve more revenue.
The governor’s exhortations remind me of Shakespeare’s Henry V,
when King Henry rouses his troops with the legendary words, “Once more unto the breach, dear friends, once more.”
Then again, King Henry was much more popular among his troops than Edwards is among lawmakers. If things don’t get better in the final week of this special session, the governor may have to assail Louisiana’s fiscal breach alone — and several hundred million short.