So far, Republican Gov. Jeff Landry has shown he has what it takes to advance historic and needed fiscal reform for Louisiana government, perhaps even if here and there pops up a disgruntled Republican over it.
A basket of bills Landry championed to remake the state’s fiscal structure has met with almost no resistance during an ongoing special session largely called to deal with the issue. His plan reduces income taxes but retains almost all of a temporary sales tax hike and expanding significantly the number of services subject to this tax while excising credits and exemptions from both, rejiggers state funding mechanisms to lower unfunded accrued liabilities of teacher pension plans and converts that into pay raises for them, forces local governments to accept the few sales tax exemptions left but lets them tax the new added services and optionally allows them to exit collecting subsidization from the state for the inventory tax credit by making them a large one-time payment, and moves certain items out of the Constitution to statute.
Everything made it out of House committees almost unchanged, and several have passed the chamber and head to the Senate. To date, GOP unanimity on these items has been nearly complete, with only Republican state Rep. Joe Stagni against measures as often than not, and on only one, extending the sales tax to some digital purposes, joined by any other Republican. Even bills which featured perhaps the heaviest lift of the session, eliminating the Motion Picture Production tax credit, passed easily.
That perhaps was anticipated. Not anticipated was on every measure at least half a dozen Democrats joined in voting for these, with apparently the most enthusiastic being Democrat state Rep. Ken Brass who actually authored one of the bills moving forward (that drew the most Republican opposition, if five can be called that, and fewest Democrats opposing). As a result, there hasn’t been a close vote yet on the items that, together, make for a far-reaching package.
In fact, the only substantive change has been salutary. Instead of keeping the temporary sales tax at 0.45 percent when made permanent, it was dropped to 0.4 percent – perhaps a small savings, but symbolically important that even slight sales tax relief comes to Louisianans.
By the end of the week, the entire kit and kaboodle should have headed to the Senate. Interestingly, the most significant negative development there comes from a die-hard conservative, GOP state Sen. Blake Miguez, who today on social media criticized reform efforts by saying Landry wasn’t concentrating enough on reining in spending. Landry responded by saying today’s House votes would “shrink” the size of government.
One could argue lowering the sales tax might reduce the size of government, but the best guess about the entire package is that it would tempt bigger government by producing a small surplus relative to the current fiscal regime (after today’s sales tax reduction as well as a few other changes, that may no longer be the case). Still, an idea not technically part of the package but endorsed by Landry can help him fend off such a charge. HB 7 by GOP state Rep. Julie Emerson would limit recurring government spending growth although it could be waived by supermajorities. Another bill, HB 13 by Republican state Rep. Brett Geymann, would do the same except growth would be defined by changes in population and prices, even as it could be waived separately. At least these would basically put a lid on expanding government, although rolling it back would need a different effort.
These instruments may be enough to placate spending hawks, who seem in principle to agree with other reforms. But the Senate will be a more dangerous place, with fewer minds to influence and the daunting supermajority requirement still in force for many of these bills. Yet through now Landry has shown skill with these lopsided votes in creating a momentum that opponents may find they can’t resist.
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