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If the Louisiana Legislature insists on playing a con game on taxes, then at least Gov. Bobby Jindal can play a shell game on them to produce a balanced budget for fiscal year 2016, which altogether does not abuse people’s property and liberty.
As the 2015 regular session lumbers closer towards its close, at first glance a great collision seems in the offing. In order to manufacture a balanced budget as required constitutionally, Jindal has said he will accept no tax increases without offsets of these, while the Legislature has insisted on building a budget dependent upon several such hikes that don’t appear to have enough commensurate tax cuts elsewhere. Thus, it looks as if the grand bargain would not materialize and one faction would have to overpower politically the other in order to stave off large spending reductions that no one, for no well-defined reason, seems to want.
But taking another glance, perhaps maybe things aren’t so conflicted. It turns out that the Jindal Administration generously defines, and appropriately as it imposed the condition in the first place, the idea of an “offset” as a multi-year concept. Secretary of Revenue Tim Barfield has stated that the period in question constitutes not a single year, but five years. Thus, a measure that raises taxes immediately, such as HCR 8 that would suspend into Aug., 2016 business utility sales tax exemptions partially to the tune of $103 million in additional revenue, could be offset and then some by the impact of HB 828, which erases the corporate franchise tax over five years that by then would grow to a forecast $912.5 million, even though the next year’s forgone revenue totals only $36.5 million.
Posted by Jeff Sadow at 11:05
The overall theme evident in this year’s regular session of the Louisiana Legislature, jerry-rigging the faulty fiscal system rather than changing it, has trickled down to the budgetary subset of higher education. If it’s election-year politics and time constraints in action, then relief may come as early as next year – if it’s not sabotaged this year.
Dealing with the budget, so far legislators have shown a marked preference for accepting agency spending demands and then seeking revenues to match, rather than taking the more sensible approach of systemic restructuring focusing on efficiency of spending tax dollars. No category has reflected this approach more faithfully than higher education, where the path of least resistance to lawmakers but of most injury to the citizenry, thoughtless tax increases, has become almost reflexive even among even some Republicans who insist they are conservatives that profess belief in right-sizing government – apparently not just right now nor right here.
In part this instinct has emerged because of elections scheduled this fall. Many politicians who claim to be principled really have feet of clay, whose core beliefs are inherently weak thus rather than lead and persuade voters of the rectitude of these instead these get treated as flags of convenience, lowered out of fear of vocal special interests amplified in a hostile media environment. From a reformer’s perspective, the good news is these spineless posers, when the winds change that make them perceive themselves out of danger of losing their offices (if they manage reelection despite their tax-friendly attitudes), will rediscover their courage and raise their flags to catch this breeze of fiscal responsibility, at least until the next time courage is needed.
Posted by Jeff Sadow at 13:15
If you think you’ve seen this bad movie before, you’re right: northwest Louisiana may face another vote on a measure defeated last year that would cost jobs and create other negative spillover effects.
HB 216 by state Rep. Alan Seabaugh resurrects an additional occupancy tax for hotel rooms and camping sites that voters thought they buried last year. Despite the mumblings of policy-makers and their shills that this bill is “different,” if there is any difference, it is in degree rather than kind: instead of the two percent additional tax in last year’s Act 674, this time it’s just 1.5 percent, split equally among the same three entities, for a few years shorter. Kind of like getting stabbed five times rather than shot six times.
Its proponents offer the same failing argument as heard last time, that by pumping roughly half a million bucks a year each into the Shreveport-Bossier Sports Commission, the Independence Bowl Foundation, and the Ark-La-Tex Regional Air Service Alliance, they will get funds to promote the area as a place for sporting events, principally the Independence Bowl, and facilitate this by having more flight choices, while few residents (only the ones that for whatever reason rent rooms or go camping) will pay for this with the costs almost exclusively foisted on outsiders. And it suffers from the same weakness, asking local voters to believe that there is a free lunch and to disregard that the increased cost of rooms will act as a disincentive to attracting events or travelers, with the consequential loss of area jobs directly and indirectly.
Posted by Jeff Sadow at 11:00
This column publishes every Sunday through Thursday around noon U.S. Central Time (maybe even after sundown on busy days, or maybe before noon if things work out, or even sometimes on the weekend if there's big news) except whenever a significant national holiday falls on the Monday through Friday associated with the otherwise-usual publication on the previous day (unless it is Thanksgiving Day, Independence Day, Christmas, or New Year's Day when it is the day on which the holiday is observed by the U.S. government). In my opinion, in addition to these are also Easter Sunday, Memorial Day and Veterans' Day.
With Monday, May 25 being Memorial Day, I invite you to explore this link.
Posted by Jeff Sadow at 12:00
Rumors of a black Democrat Louisiana gubernatorial candidate that could be competitive continue to swirl, but in the end they would make a significant difference in the dynamics of the contest only if black party leaders saw their interests diverging from the white powerbrokers in their party.
Recent speculation offers up attorney Tony Clayton, long-time appointee of Gov. Bobby Jindal on the Southern University Board of Supervisors during which time he has served as its chairman, and Lt. Gen. (ret.) Russel Honore, famed in the past for crisis leadership during the hurricane disasters of about a decade past and more recently working to lead on pro-, even extremist, environmental concerns. On the part of Democrats, this continued chatter even after the state party officially endorsed state Rep. John Bel Edwards connotes uneasiness that Edwards, whose polling and demographic numbers give him little chance to win, can serve as an adequate placeholder to gather funds and support down-ballot candidates.
However, it also could signal machinations on the part of some Republican interests. While Edwards’ polling numbers have fallen below expectations, Sen. David Vitter’s have exceeded these, leaving the other two Republican candidates, Lt. Gov. Jay Dardenne and Public Service Commissioner Scott Angelle, at risk for not advancing to a runoff. The thinking goes that if a black face could enter the contest, this would peel off the majority of the black vote that Edwards should be expected to receive otherwise, and this split would ace both Edwards and the black candidate out of the runoff to allow another Republican to join Vitter.
Posted by Jeff Sadow at 14:15