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For his agenda, Edwards games tax cut impact

Looks like Louisiana’s Democrat Gov. John Bel Edwards is going for broke in his quest to turn back the clock on the state’s fiscal practices.

Edwards attempt to forestall right-sizing of state government hinges on finding new revenues to support a bloated state sector. Trumpeting budget deficit after budget deficit best accomplishes this objective. Thus, any organic creation of new revenues – i.e., a larger tax haul without raising rates or scrapping exceptions – puts a dent in this plan as it reduces the deficit, relieving pressure on instituting permanent new revenue sources – particularly his preferred progressive income taxation especially on corporations or fewer exceptions where the bulk of newly-unshielded dollars would come from transactions disproportionately undertaken by higher-income entities.

Thus, his administration has tried to throw cold water over the beneficial impact tax cuts passed the Republican-led Congress and signed into law by GOP Pres. Donald Trump would have on the projected fiscal year 2019 budget for Louisiana. Reviewing those changes, and only partially, the Edwards Administration said it would mean a boost of $200 million to $250 million for FY 2019. That covers only individual income tax collection; the Administration has abjured from estimating the impact that corporate tax cuts would produce, so the figure could go much higher.


Decision could trigger enormous LA fiscal change

Hold on to your hernia belts, a potential court decision either could make Louisiana state budgeting more intractable or become a catalyst for badly needed change.

After years of sifting through legal minutiae, a state district court finally will hear on the merits a suit brought by the Public Service Commission against the Legislature for sweeping money from dedicated funds that provide revenues for PSC operations. Past special appropriations bills have yanked millions of dollars from coffers set up to hold money for the PSC.

Statute can be interpreted to support either side. For example, R.S. 45:1177, in setting up the Utility and Carrier Inspection and Supervision Fund, states that “[t]he monies in this fund shall be used solely for the expenses of the operations of the commission” and “[i]f the amounts contained in the fund provided for in this Section are in excess of that necessary to fund the operations of the commission, then that excess shall be retained in such funds,” or pretty standard boilerplate for a dedicated fund.


LA mayors oddly treat Farrakhan with honor

The Honorable Minister Louis Farrakhan Tour across north Louisiana left equal parts outrage and head-scratching over the action by the mayors of the area’s central cities.

Farrakhan decamped to Louisiana to view the Dec. 15 graduation of his granddaughter at Grambling State University. He blew into Shreveport the prior day, whereupon the city corralled some on-duty police officers and escorted him from the airport to the city-owned Hilton Hotel.

Plans to escort him to the city limits the next day on his way to Grambling apparently never materialized. Allegedly, he also received such services to a restaurant where a private function occurred, but city attorney William Bradford denied any such authorization existed.


Holding cards, Barras deflects Edwards' bullying

While he didn’t exactly treat Democrat Gov. John Bel Edwards as if Louisiana’s chief executive didn’t exist, Republican House Speaker Taylor Barras did make clear who called the shots over the state’s fiscal year 2019 picture and beyond.

Late last year, Edwards declared he wanted consensus with the Legislature by Jan. 19 on a package to reduce a projected budget deficit of around $1 billion, a gap mainly driven by the disappearance of temporary taxes. With that in hand, he said he then would call for a February special session to implement such a plan. The Legislature cannot raise taxes in even-numbered years during the regular session that begins in March, and having a special session after the regular session’s end in June would leave little time to produce a comprehensive solution.

In making this demand, Edwards hopes to avoid continued singular association with tax increases. By rushing the Republicans who control the Legislature into signing onto this agenda by refusing to call a session for revenue-raising, he can deflect blame for reelection purposes by reminding that a permanent, income tax-raising solution and perhaps broadening the sales tax base to negate a nagging budget deficit came in bipartisan fashion.