After five months of nonstop fiscal fights, state lawmakers have finally gone home — hopefully for the rest of the year — leaving behind a slew of new taxes and millions in budget cuts. That's about the worst possible outcome, but it should surprise no one.
Herewith a final installment of 2016's "Da Winnas and Da Loozas."
1. House Republicans — For the first time in a while, House Republicans are truly a functioning caucus. They warned Gov. John Bel Edwards not to call a second special session right away. They told him he would not get everything he wanted — and they kept their promise. The House GOP leadership found its legs in this latest session, but the caucus also exposed its Achilles heel: House Republicans voted to cut TOPS, which is popular among their own constituents. Also, they've proved they know how to say "no" to taxes but can they find the will to say "yes" to real fiscal reform next year? That remains to be seen.
2. Individual taxpayers — They were spared any income tax hikes when the House declined to adjust the rates or tinker with itemized deductions, which is bad news for long-term fiscal (tax) reform but good news for middle-income taxpayers and folks earning more than $100,000 a year.
3. Oil & gas companies — Law-makers passed a bill that rewrites the formula for calculating corporate income taxes owed by large companies — but only after amending the measure to exempt "integrated" oil and gas companies from the new calculations. Integrated oil and gas companies are those involved in every step of oil and gas from extraction to final sale. Here's the kicker: The lawmaker who offered the amendment — Rep. Jim Morris, a Republican from (where else?) Oil City — couldn't explain it beyond saying that it would help oil and gas companies. That was good enough.
4. Small and medium-sized businesses — They now will be able to take full advantage of the state's inventory tax rebate program, as lawmakers rolled back a law (passed earlier this year) that reduced inventory tax rebates for all businesses.
5. Higher education & public hospitals — The two most frequent targets for cuts got most of their funding restored.
6. Saints/Pelicans fans and nonprofits — Lawmakers cleaned up some messy sales tax provisions that were adopted in haste — and inadvertently — in the first special session. Now, tickets to Saints and Pelicans games won't be taxed, nor will dues to nonprofit organizations (Girl Scouts, Boy Scouts, Mardi Gras krewes and others). Which brings us to ...
1. Gov. John Bel Edwards — He wanted $600 million in additional taxes and got less than half that. His one consolation: He can legitimately put the blame for any cuts to TOPS on House Republicans. On the other hand, if the state realizes more revenue than predicted from some of the just-passed taxes, he'll have some explaining to do.
2. Big Business — The Louisiana Association of Business and Industry (LABI) scored early wins by bottling up across-the-board cuts to various business tax breaks, but thereafter it was all downhill for big businesses. A number of bills pitted large businesses against their smaller counterparts, and in the end the Big Boyz got hosed. Chemical companies failed to kill a bill reversing the impact of a state Supreme Court case giving chemical plants a major tax break. Elsewhere, lawmakers passed a measure to raise corporate income taxes paid by interstate companies; another bill forces large companies to choose between their inventory tax refunds and their industrial tax exemptions; and yet another bill cuts inventory tax rebates to large companies.
3. College students & their families — The TOPS college scholarship program was cut for the first time — from full funding to 70 percent funding, although (at the last minute) the program was "front-loaded" so it's fully funded for the fall semester. It's possible the governor will veto the "front-loading" language in the supplemental budget bill, but if he does, it could shift the "blame" for cutting TOPS to him. In any event, this first-ever reduction in TOPS funding may portend future cuts as lawmakers struggle to control the popular program's runaway costs.
4. Homeowners — The tax credit that homeowners get for paying a "FAIR Plan" assessment on their homeowners insurance policies was reduced by almost two-thirds, from 75 percent of the assessment to 25 percent.
5. HMO subscribers — Technically, lawmakers raised the annual tax rate on HMOs from 2.25 percent to 5.5 percent, but there's little doubt that the health insurers will pass on the added costs to their subscribers. This was the single biggest tax hike of the second special session and one of the biggest of the year. HMOs got a small tax credit in a separate bill, but it's pennies compared to the impact of the tax hike.
6. The working poor — A bill to increase the amount of the Earned Income Tax Credit failed ... again.
7. K-12 education — Another victim of cuts triggered by the House's failure to raise more money and lawmakers thus being forced to allocate the pain rather than the money. Teachers and special ed students in poorer school districts could really feel the impact of this.
In the end, lawmakers pleased almost no one. They taxed Big Business and cut services to the Little Guys. Better luck next year, y'all.