Jindal must take care in organizing next special session

Job done with meaningful ethics reform in the special session. But is Gov. Bobby Jindal whistling in the dark when it comes to his thinking that the next special session, planned for Mar. 7, will not be difficult or contentious?

Jindal’s thinking here is since the exercise will involve spending a “past” surplus now estimated at $1.088 billion, giving away money out to improve the humor of legislators. In addition, other funds have appeared eligible for spending, $982 million. The first batch of money should conform to Jindal’s prediction. This is because constitutionally it can be spent only on non-recurring items, such as debt reduction, capital outlay items like roads (or for a business incubation center in Bossier Parish for cyber-related concerns), coastal restoration, and reduction of unfunded accrued liabilities. The call should include these items.

And only them, because other money can be spent for any purpose which will lead to three political problems for Jindal that he best leave to the regular session. First, his priorities likely will differ from a number of legislators’, particularly from the Senate so the anything-goes nature of the call will set up conflict between freer spenders and Jindal. Second, what gets spent on recurring items, unlike nonrecurring items, will count against the state’s spending cap (the state cannot increase spending beyond the rate of increase of private sector growth without two-thirds legislative approval) and Jindal will want the increased flexibility that comes from greater budgetary options that will present themselves during the regular session. Third, one way to “spend” and not have it count against the cap is tax cuts and those will be politically unpopular among some tax-and-spend and/or good old boy legislators who want to have more, not less, money in state government hands.

When issuing the call, Jindal also must make clear two things. First, spending on capital items will have to be for purposes that serve a genuine state need and if they don’t he’ll use the line-item veto on them. This means few in the way of local projects, and no sham “economic development” measures like reservoirs requiring a huge capital investment with little real return. Second, money spent in the special session on roads does not mean that more recurring revenues won’t be dedicated to roads in the regular session and the future by passing a law mandating all transportation-related revenues be spent on transportation items (currently not the practice, with $300+ million a year being dumped into the general fund despite 40 times that in identified state road needs).

Just as the ethics special session created good public policy and served as an optimal vehicle to increase Jindal’s political capital, so should the nonrecurring surplus special session be designed to do the same. Because Jindal’s forthcoming ideas, if he keeps to campaign promises, will alter radically the state’s fiscal priorities and reduce its spending appetite to taxpayers’ benefits, he will face bitter resistance from entrenched interests. Few grasp that he has indicated such profound changes at odds with the state’s political culture and thus he will need all the capital he can get to succeed, and not trying to take too big of a bite by pursuing less controversial fiscal changes first will help.