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LA flooding likely to have little budgetary impact

Upon pondering about the fiscal impact of the recent floods striking the Baton Rouge area, my Advocate colleagues got it half right and half wrong. Through an editorial correcting the misimpressions of some, they argued that, no, the volume of recovery money shoved through the economic system will not produce a “bonus” that will solve a looming budget deficit, but missed the mark in neither will it also exact a significant penalty that could worsen the fiscal situation further.

When the hurricane disasters of 2005 occurred, at first policy-makers believed the massive scale of devastation would put a serious crimp into the state’s economy, driving down collected tax revenues. Two months after the levees failed in New Orleans, the Revenue Estimating Conference convened to slice nearly $1 billion out of budgeted general fund collections for fiscal year 2006, and a subsequent special session of the Legislature went out to chop around that much out of the budget.

What they did not figure was that exact extreme destruction would prompt so much recovery spending coming from sources outside of the state – the federal government and private insurers – that this produced a surge in general tax collections. In the decade afterwards, the federal government would spend $18.2 billion on various aspects related to the storms, its flood insurance would pay claims of $13 billion, and private insurers would pay out around $25.9 billion, almost all of these coming in the first five years.


Voucher deal threatens to make Edwards look worse

Perhaps Louisiana Education Superintendent John White has outfoxed Democrat Gov. John Bel Edwards in the struggle to keep the Student Scholarships for Educational Excellence Program from attenuation.

When the budget process shook out, the program that provides funding for students that attend or would attend subpar schools to enroll in an eligible private or public school took a funding hit of over 5 percent. This meant that several hundred families already accepted into the program would not receive vouchers, a program first.

But behind the scenes White formulated a deal with providers to take on the wait-listed students. He said, with the blessing of the Board of Elementary and Secondary Education, that the state could give through the families to schools enrolling these children around $100 guaranteed for each enrollee – more than $5,000 below the typical tuition the schools could charge the program participants – in the hopes that perhaps the Legislature in the spring would create a supplemental appropriation to pay off the balance.


Politicized disaster funding system to impact LA

So much anxiety over what kind of relief Louisiana can expect in response to the flood disaster surrounding Baton Rouge earlier this month would disperse by wringing the politics out of the disaster funding process.

Observers fret about the relative lack of seniority of Louisiana’s members of Congress, that at least two and possibly three of the most senior will not return, that the most powerful Majority Whip Rep. Steve Scalise must balance state and party interests, and that past votes against sending money to other locations may come back to haunt the state when discussing the state’s chances of landing a decent sum to assist in paying for cleanup. Without a system so infused with politics, these questions would matter little.

In brief, current law centralizes most disaster recovery funding in federal hands. Essentially, when hitting a small trigger amount – about $6 million in the case of Louisiana – federal aid of at least 75 percent of costs kicks in for almost every kind of recovery spending, with some of an emergency nature paid fully by the federal government. Potentially, by law federal policy-makers could pay for it all. Moreover, the process for making states eligible – a disaster declaration of any of several kinds – relies on almost total subjectivity. This low threshold and leaving a declaration ultimately in the hands of an elected official, the president, has led to an exponential increase over the past nearly quarter-century in declarations and amount paid out. From typically two or three dozen declarations a year under Pres. Ronald Reagan, Pres. Barack Obama now issues hundreds a year.


Jones CD-4 campaign built on lightning striking twice

Although invited, last week Louisiana Fourth Congressional District hopeful Democrat Marshall Jones did not attend a candidate forum at Bossier Parish Community College. Nor will he attend many, if any, of these kinds of events throughout the election season.

In this instance, as besides BPCC both the Bossier and Caddo Parish Republican Parties sponsored the gathering, perhaps Jones, the only Democrat in the contest and who declined participation, could have an excuse not to appear. But throughout the campaign expect him to dodge as many as he can unscripted events that could feature inconvenient questions.

This is because state Democrats have had their hearts fluttering thinking they can replicate the success of Democrat Gov. John Bel Edwards given his surprising victory last year. They see a formula to create a winning coalition: have a Democrat express social conservatism on God, guns, and the unborn as loudly and as often as possible while infrequently mumbling liberal economic bromides and other issue preferences of the left they figure will reassure enough of the hard left base while conning enough of the center-right electorate into thinking such as candidate acceptable, aided by a multitude of quality Republican candidates not paying attention to him in the rush to bash each other.