SB 120 cut taxes to help society's most vulnerable

As the committee work winds down in the Legislature, signaled by the attention now being given the budgets, almost all of the measures to revise the problems created by the Stelly Plan look like they will die quiet deaths (with the exception of SB1 which died a very public one). In fact, only one bill really has a chance to pass into law – one that corrects one of the greatest inequities of the tax revision.

The Stelly Plan eliminated the use of any “excess” deductions from federal income taxes, so people with a high amount of deductions could not also write these off on state taxes. For an unlucky few, some had high deductions because of medical expenses.

While there are some who can’t control their appetites for food or nicotine and thereby create health problems for themselves (or, worse, the taxpayers when they make them pay for their indulgences), the vast majority of health care expenses are from unavoidable bad luck. Something the supporters of the 2002 measure did not realize that some families have crushing expenses in this regard (unless you are around the poverty level and below and then the government pays for everything) which can reduce living standards of even the highest-income families close to poverty level in the worst cases.

One compensating factor has been the ability to write off the expenses on federal taxes which for even the lowest-middle class income would have to be astronomical to completely offset federal income tax owed. At the state level, a middle-income family could get a tax break of hundreds of dollars if the rule is changed back prior to the 2002 measure (which, for example, would pay for 20 hours of skilled nursing, or one two-week supply of respiratory medicine).

SB 120 is the bill that would do this. It’s cheap (relatively, in large part because it is being phased in over 10 years) with an estimated price tag of $380,000 and would provide valuable assistance to those and their families who are the most vulnerable in our society. Right now it sits idly in the Senate, having passed out of committee, waiting for enlightened leadership to bring it out and wise voting to pass it on to the House.

Not only then must the House pass it, but Gov. Kathleen Blanco unconscionably seems to oppose the bill which may require even more Legislative support to override a potential veto (we can only hope Blanco never has to experience what these families are going through, because perhaps then she would change her mind on this).

Time is running out, with only about three weeks to go in the session, to get this important bill through the process. It’s too bad other revisions won’t make it, but let’s hope lawmakers get moving on this exceptionally important alteration to the Stelly Plan.