Debate preferred over rhetoric in assessing budget funds

While to some delving into the mysteries of Louisiana’s state budget ranks up there with root canal surgery, understanding its eccentricities develops a better understanding of what constitutes better and worse budgeting, and what needs changed to make it better. Dissecting Gov. Bobby Jindal’s fiscal year 2015 attempt on this account to go before the Legislature within the month exemplifies the issue.

Something about it that got observers wondering was how targeted spending increases could occur in certain areas when overall revenues were down overall. Even a small increase in general fund receipts would not account for the entirety of that. Let’s see why.

Again, to understand where everything is going, it’s helpful to keep terms straight. A simple kind of revenue to conceptualize is “nonrecurring.” These are defined as an unanticipated bonus beyond forecasted revenues and may be used on any of a half-dozen different purposes constitutionally defined, including debt defeasance, paying into the state’s Coastal Protection and Restoration Fund, supplementing its Budget Stabilization Fund or savings account, and paying down the state’s unfunded accrued liability on its retirement funds.

Unwise bill tampers with representative democracy

Mavens of the Louisiana Legislature purport that it takes several tries for some good bills to get into law. But offering up flawed legislation similar to earlier versions doesn’t make it good, and that’s the situation state Rep. John Schroder finds with his prefiled HB 108 for this upcoming regular session.

It resembles his HB 387 from last year, which went nowhere, with two extensions. The bill would protect any “public employee” who provides information to a legislator or committee from “discipline, reprisal, or threats of discipline or reprisal by the public employer for providing such information,” creates an enforcement mechanism, and provides for penalties. It differs in that it acknowledges Department of State Civil Service authority and defines what a “request” for information means.

By its introduction and in its wording, it carries a disingenuous air, implying that this practice already in the main is not outlawed. But, in fact, the majority of Louisiana state employees, those who are in the classified service, already have these protections; they cannot be disciplined or fired without evidence of unsatisfactory performance and they also have explicit protections (as the DSCS separately conveyed in conjunction with the filing of the bill) when engaging in issue advocacy, as testifying in front of a legislative committee would exemplify.

Fund draining tactic to trigger bad amendment rejection?

The Gov. Bobby Jindal Administration with its health care budget has made it put up or shut up time for the Legislature in regards to a number of controversial funding decisions it made in the past that favor nursing homes at taxpayer expense.

That comes in the form of a portion of the payments going to nursing homes for Medicaid patients coming from the Medicaid Trust Fund for the Elderly. The Fund was created with federal government money to provide a vehicle to prop up reimbursement rates, and since has received continued matching revenues from it as well as from investment activities, fines paid by these providers, and specialty license plate sales.

This creation occurred at the height of nursing home influence in the Legislature, in an era that allowed nursing homes in the state to ring up among the states some of the highest proportion of their revenues from Medicaid while delivering among the highest costs per bed, which continues to this day. This inefficiency grew worse with the implementation of a program to pay them tens of millions of dollars for thousands of empty beds while the crowning blow to taxpayers came when the case mix methodology allowing this overgenerous state of affairs became enshrined in state law in 2006.

Excluding profiteering from campaigning needed reform

The ready-made legacy or campaign issue of campaign finance spending reform remains available, with the matter up for discussion of candidates using campaign funds in enriching relatives – or even indirectly themselves – for providing campaign services.

While they provided unhelpful analysis regarding raising campaign funds, the media series of the New Orleans Times-Picayune and WVUE-TV highlighted some spending practices permitted for these funds that are ripe for change. They now add to that the consequences of lax regulations regarding elected officials’ family members and their own abilities to have campaign donations as compensation for activities performed in the course of campaigning.

R.S.18:1505.2 serves to define how expenditures are controlled to “immediate family members,” defined as typically in the larger ethics code as parents, siblings, children, their spouses, and parents of a spouse. These are prohibited directly, but may be made to entities where the member has “any” ownership interest. Here, anything goes as long as what is provided qualifies as a campaign expenditure, it is of fair value, and the business involved has been registered with the secretary of state for a year or has the appropriate license from a local government authority.

Change judge selection to promote judiciary right-sizing

Yeah, as was feared in this space and elsewhere, they punted. With that reality in mind, advocates of right-sized government in Louisiana now must look beyond this setback in how to reform the bloated Louisiana judicial system.

At least give credit to a special committee made up of legislators, judges, and lay people most connected to the judicial function of state and local government that gave every indication it would miss a legally-imposed Feb. 15 deadline on producing final reports on a full slate of judicial bodies, investigating questions about appropriate caseloads and resources for the three parish, five appellate circuit courts, and 48 district and 49 city court systems in the state. After three years, it produced something by this deadline on 8 court systems – the easiest with those being the parish and circuits courts – and left the other 92.4 percent off by boldly declaring more study was needed, and now its members can go congratulate themselves for being on time.

But incredibly off target, as New Orleans’ Bureau of Government Research has outlined. Past efforts by the group, embarrassingly for the special panel using that committee’s own methodology, demonstrated vast inequities in judicial resources across the state that indicated perhaps a quarter of all courts were superfluous, thereby rendering them as little more needed than as vehicles to transfer taxpayer wealth to a small group of elected officials and bureaucrats. It urged the commission, which appeared to dither with few meetings and no sense of urgency in scheduling activities to meet the statutory deadline to produce reports with meaningful conclusions about significant reform measures or reasons why that wasn’t needed, to be on time because this would be the last regular session of the Legislature before elections for roughly four-fifths of judicial slots this fall. The Constitution prohibits shortening the lengths of terms for judges, so any solution that includes eliminating judgeships this means a wait until 2020 for any action, with the remainder prior to 2016, 2018, and 2022.

GOP, Obama, Landrieu move her closer to checkmate

Her political life continues, but the sharks definitely are circling and continue to close in on Sen. Mary Landrieu as her reelection polling numbers erode further, Republicans maneuver to leave her no way out, and the Gromyko of the White House refuses to toss her a lifeline.

The Louisiana Democrat, despite having an exceptionally liberal voting record in her 17 years in office, has survived because she began with a narrative that she was a moderate willing to buck her party on important issues to the state and expanded it to an imagery that her experience made her too effective for replacement. But (brace yourself in visualizing this metaphor) the clothes are off the empress for many, beginning with her failure to vote against the misnamed Patient Protection and Affordable Care Act (“Obamacare’), which otherwise would have defeated it. As the latest poll numbers from the Democrat-sympathetic Public Policy Polling shows, an absolute majority of registered voters loath the law that already is pricing many out of the insurance market, forcing them to change providers, encouraging rationed and less convenient care, and making some pay for the leisure activities of others.

As a result, the PPP summary notes she has an absolute majority of respondents also disliking her, a number that has continued to rise (and this trend perhaps explains why PPP had a gap of just two months from the last polls of this contest, which ballooned nearly to five months this time). In tandem, keeping in mind that the voting model here by using registered voters disproportionately favor Democrat candidates and is based upon presidential, not midterm, electorates that also favor Democrats, support for her main challenger Republican Rep. Bill Cassidy has continued to rise as has his name and party recognition. If not already, this trend threatens to become irreversible.

Edwards parrots bogus study, adds own analytical error

The political story here isn’t that an interest group put out flawed data, nor that it used that in a bogus argument, but that a Louisiana gubernatorial candidate fell for it hook, line, and sinker – again – and then added his own misinformation to compound the error.

Last week, Louisiana was one of 10 states mentioned in a report by the leftist group Good Jobs First, which criticizes government subsidies and tax breaks only to corporations as part of its government-centric, labor-friendly, static view of economic development. The report reviewed, quite selectively as pointed out by Louisiana’s Secretary of Economic Development Stephen Moret, such programs in these states and compared their costs to pension costs. It concluded that in all states reviewed these subsidies/breaks exceeded pension costs, and the gap was greatest in Louisiana. This assertion was used in support of a narrative that states ought not be trying to find ways to reduce pension costs to taxpayers when they apparently give away so much corporate largesse.

Specifically for Louisiana, the group selected $1.8 billion in corporate subsidization (which admittedly contains some speculative numbers, such as the estimate made by a Ralph Nader-connected interest group that claimed “corporate tax avoidance” cost the state nearly a half billion bucks) and determined pension costs were about $350 million a year. These costs were derived from data from the two, of four, “state” retirement systems (the nine other “statewide” systems are much smaller) presumably because the two, the Louisiana State Employees’ Retirement System and the Teachers’ Retirement System of Louisiana, between them have 85 percent of all state system retirement assets.

Centenary's education commitment questioned by hike

It’s not that Centenary College asks students and their families to pay a lot more, or perhaps even at all, to make an ideological point, but it is that the school’s administration is willing to put fashion ahead of its education mission.

Last month, in this year’s State of the Union address, Pres. Barack Obama exhorted that American subnational governments (that had not yet done so) raise their minimum wage laws to $10.10 an hour. Of course, doing this, or even having such a notion as a minimum wage, betrays profound ignorance of economics. In a market system with provisions against monopoly, the market sets wages in proportion to the benefits they provide society through the activity being compensated. Artificially inflating wages only serves to channel resources inappropriately, removing them from more productive uses that if they instead went to those uses then would increase overall societal wealth, including a rise in the absolute living standards of the lowest wage earners (of which 2.9 percent of all workers make the minimum wage, of which two-thirds are part-timers, most of whom are not sole breadwinners, and half are 24 or younger).

This also promotes increased unemployment, as the pot of money (which now will grow more slowly because of the misallocation) is allowed to be divided among fewer individuals, and fewer jobs holds down the rising of levels for everybody. While some analysts, who no doubt believe that money grows on trees and in the Tooth Fairy who brings it from nowhere, argue that this increases purchasing power of the recipients which should promote economic growth, they either are too ignorant to grasp or deliberately ignore that the money is redistributed from elsewhere, and from its more productive uses. It’s nothing more than wealth redistribution for unjustifiable reasons, and an immoral act that deprives those the least able (if willing) to contribute to society by erasing their means by which to achieve this.

For outsiders to it, St. George opposition driven by greed

It’s easy to understand why opponents inside and outside of the proposed city of St. George and of a school district built around it likely following its incorporation so strenuously lobby against these: greed.

St. George would include most of the unincorporated area of East Baton Rouge Parish, which historically has been a net generator of tax dollars compared to services used. By contrast, the city of Baton Rouge has become a net debtor in comparing expenses to tax dollars generated. The same relationship to a different degree has been the case for comparing the same areas for school district purposes, although any separation of these at some point will involve construction of new facilities that may end up requiring tax increases to fund the new St. George school district, although it may well avoid them in that the present entire district itself presently has no bonded indebtedness.

Although these units are separate matters, they are linked in the minds of parish residents because the school breakaway idea came prior to the new city incorporation idea, where the latter is seen as a way of facilitating the former. While the Legislature has already approved of the separate district, it has not created a way to fund it; advocates of it hope that creation of the city, accomplished by getting a petition calling for an incorporation election of a quarter of registered voters among those living in this unincorporated area with simple majority approval, will spur the Legislature to finish the job by amending the existing district (which does not conform to the boundaries of the proposed municipality) and enabling the funding.

Bargain LA tuition means hike it more to help education

As debate launches about the appropriate funding mix for Louisiana higher education and discussion occurs about reforming free taxpayer-funded rides for its students prior to the upcoming regular session of the Legislature, usually lost in it all is the fact that Louisiana undercharges these users both in relative and absolute terms, with deleterious effects.

Over the past several years, with legislative countenance to make the process easier, rising tuition (and the addition of a small amount of fees or their increases) by the state’s higher education institutions have changed significantly the role that user charges have played in funding this enterprise. In the fiscal year that encompassed the first six months of Gov. Bobby Jindal’s initial term in office, tuition and self-generated fees paid for 26.3 percent of the $2.814 billion spent. In this fiscal year, it’s budgeted to pay for 48.7 percent of $2.629 billion. By way of example, this means over this period that resident tuition and fees at my institution have gone up for a full 12+-hour load per semester from $1,667.40 to $2,471.64, a hike of almost 50 percent.

Critics of Jindal’s budgeting and legislative acquiescence of it claim this presents an unacceptable barrier to access for cash-strapped households, and decry that the state’s contribution, directly or indirectly, has gone down hundreds of millions of dollars as a result. But such a view fails to understand that reductions seem so stark only because the state has historically so generously subsidized students – to the detriment of the system and possibly to the students themselves.