Budgeting choices now may affect governor's race later

Some presumed candidates for Louisiana governor in 2015 got called onto the carpet by state legislators for their alleged overspending on employee pay raises. The legislative querying produced some campaign propaganda points favoring certain of them at the expense of others.

The House Appropriations Committee, in its initial budget review for the next fiscal year, suddenly seems to have discovered that elected executive branch officials can give these pay raises, even as “merit” pay raises for other executive branch civil service classified employees have not happened for four years and for some unclassified employees even longer. Why this sudden realization that legally these officials could do this materialized now, from among individuals who wanted to vote themselves pay increases less than five years ago, remains a mystery, but became a topic of interrogation for some elected executives.

As they pointed out to varying degrees extenuating circumstances, such as the need to keep what they believed were key employees, that they budgeted to be able to do this, and that attainment of merit standards by employees meant these people deserved this. In addition, Insurance Commissioner Jim Donelon claimed Department of State Civil Service rules forced him to grant four percent pay raises when money was available, and Agriculture Commissioner Mike Strain said the law made him grant raises. These were in reference to mandated civil service rules that said certain personnel actions required raises to be given if money was available. But agency heads have discretion in making these dollars available: they could have gone to filling more positions or to finance other activities, so to claim they were “forced” to give raises is an overstatement.

PAR expansion framework falls short for proper analysis

More information always is better, and in that sense the Public Affairs Research Council has done a service by producing a guideline for analysis of whether Louisiana ought to accept federal money with considerable strings attached to expand Medicaid eligibility. But unfortunately it falls short conceptually, which makes vulnerable whatever recommendations would stem from its suggested course of study to the criticisms it levies.

The report reviews mainly two others from dispassionate, nonpartisan sources that provided the starting point from which Louisiana officials to date have determined not to pursue this option. However, some of its critiques also focus on problems that cropped up in more partisan, less objective analyses (many already addressed prior to this effort here).

Had the effort stopped just at pointing out the shortcomings of analyses based upon these several reports, little value would have come of it. But by then highlighting avenues of data acquisition and analyses that policy-makers ought to pursue provides for a good start. If state policy-makers already are not cognizant of these items in need of periodic review, then this serves as a basic primer on them.

Landrieu wish to punish oil further toughens reelection

Did Sen. Mary Landrieu commit political suicide with remarks recently published about her willingness to end tax breaks for oil companies?

The Democrat has walked, successfully to date, a fine line in staying on office in a state whose people increasingly are willing to vote on this basis of ideology, the majority of whose views poorly fit her own expressed views. To date, she has sustained a myth that she is a moderate Democrat when in fact she votes very much to the left: her lifetime American Conservative Union voting record (where a score of 100 equates to a perfect conservative voting record) is barely above 20.

Yet she has won three elections and his gunning for a fourth, partly because she has become expert at peeling off just enough support from those whose interests she typically votes against, but on the most salient issues to them she sometimes backs them. One is the oil industry, where historically she has fought attempts to increase the tax burden on the industry, one understandably important to Louisiana.

Dardenne Senate run may make sense for him, conservatives

Suddenly, if you consider media reaction being anything close to a genuine reading of public opinion, in Louisiana Lt. Gov. Jay Dardenne is the hottest politician in terms of political future. And perhaps it is conservative Republicans, who have had a rocky relationship with him, who join the mainstream media here in a kind of wishful thinking that may become reality.

Last month, a poll came to attention perhaps more because of Dardenne’s place in it than anything else. In part, it asked public opinion on hypothetical 2014 Senate matchups featuring Sen. Mary Landrieu. The Democrat widely is considered, if not the most vulnerable, one of the most vulnerable senators to lose her seat in the upcoming election.

Although Dardenne’s name never had been mentioned as a Senate candidate – the most cited names have been Reps. Bill Cassidy and John Fleming, former Rep. Jeff Landry, and recently inserting himself into the discussion, Board of Elementary and Secondary Education Chairman Chas Roemer – it was included against Landrieu, and he polled the best. State media outlets made inquiries, and then a national opinion magazine did a whole story on the possibility of Dardenne running. The perspicacious The Hayride also weighed in.

Unfunded mandate change misunderstands govt roles

While on the surface a constitutional amendment to prohibit foisting unfunded mandates onto all local governments in Louisiana may sound appealing, it’s better public policy not to hamstring state policy-making in this fashion.

Currently, the Louisiana Constitution prohibits the state from saddling local governments from certain kinds of these unless the local government approves and it is willing to pay for them. However, a number of exceptions exist, separated by school districts and all others; for examples of the latter, increased pension contributions to pay off the state’s unfunded accrued liabilities may be passed along because the Constitution applies this part only to legislation passed essentially after 1991, and the amendment to pay down the UAL became part of the Constitution in 1989. Other civil service legal changes that affect local governments also are exempted regardless of date enacted, and there are several others.

School districts get a different set of exemptions; for example, if an unfunded mandate comes down, as often happens, the Minimum Foundation Program does not have to pay for it. Also included is anything having to do with implementing accountability, if there is a cost increase, and there are several others. This part of the Constitution applies for matters passed essentially only after 2006.

Half-baked budget critique provides no better alternative

While it’s quite fair to point out the hazard behind the concept of using one-off revenues to fund an operating commitment, at the same time it’s incumbent on those doing the criticizing to come up with responsible alternatives to deal with any ensuing revenue adjustment – especially when they haven’t quite characterized the source of their complaint fairly.

That’s the trap state Reps. Thomas Carmody, Cameron Henry, and John Schroder have fallen into extending from their critique about one aspect of Gov. Bobby Jindal’s proposed budget. It concerns two presumed bonuses the state will collect with their proceeds going to fund higher education.

The state will take advantage of artificially-low interest rates to refinance indebtedness to pay off advancement of the tobacco settlement in 2001. Instead of taking some annuitized payments, the state arranged to take 60 percent of the money up front, or $1.202 billion, three-quarters socked it away in a fund, the Millennium Trust Fund, and promised to make periodic payments to lenders for getting it earlier. Refinancing of the bonds to help pay for that will save $85 million, available within the upcoming fiscal year.

Legislature fiddles while passing on burning budget items

Both efforts ended up the same way. That one did as it did and the other was pursued at all tells us all we need to know about the courage and priorities of the Louisiana Legislature.

Yesterday, the Legislature’s Revenue Study Commission issued its final report, which boldly stated that not all of the hundreds of tax exemptions on the books might be worthwhile, but that more data were needed to know that, and that they should be collected when they aren’t (even though common sense might have indicated creating such evaluative mechanisms each and every time another one of these was carved out), and maybe the Legislature ought to do something about this and a bunch of these exemptions. Meanwhile, dog bites man.

The same day these scintillating conclusions got broached to the wider world, another legislative panel spent 270 minutes tackling, with arguments about sequester effects, budget gimmickry accusations, and tax reform agendas swirling about competing as subjects of legislative investigation, the all-important, if not the most pressing issue of the millennia – whether the Louisiana High School Athletic Association should do as Texas has done for decades, creating separate championship classifications for public and non-public schools. At the conclusion, its members decisively moved to do nothing about what apparently legally they could do nothing about anyway.

GOP Jindal successor hopefuls differ in early strategies

So you looked at a calendar and thought it was 2013? Guess again; it’s really 2015, you would derive from statements being made by individuals believed to have great interest in succeeding Gov. Bobby Jindal. Statements, in fact, that reveal an early strategy of building desired campaign success on criticizing their party’s incumbent governor – or not.

Lt. Gov. Jay Dardenne is no stranger to whining about how the area over which the Constitution assigns him authority, culture, recreation, and tourism, has faces disproportionate reductions in discretional provision of services – not as much because of revenue reductions, as a large majority of the money this department in state government receives comes from dedicated sources, but because of revenue redirections permitted under law that take away his ability to spend money as he pleases. Now he’s found more reason to complain on this score.

This time, it’s because state law allows for money dedicated into a fund often used for maintenance of parks also to be used for their continuing operations, which is what Jindal proposed and the Legislature passed last year, and what Jindal has proposed that most of the money his administration forecasts will go into it does again. Dardenne moaned about how repairs need to be made to park infrastructure as a result of last year’s Hurricane Isaac, and how the redirection was cramping his style in this regard. He argued the state could make money off of the repaired facilities, which feeds back into the fund which may be needed to support operational activities, as budgeted.

Bills to privilege state laid off employees unjustifiable

Mondays are slow news days, so today the Baton Rouge Advocate took out of the can a piece about a bill introduced the week before last that makes one wonder just how much the legislation’s author knows about state retirement regulations and/or the free market.

State Rep. Regina Barrow has introduced bills that would create exceptional treatment for long-time employees of the state hospital system. According to the budget to be considered this year, about 95 percent of them will lose state jobs as eight of 10 charity hospitals will be administered by nongovernment entities by Jul. 1. (Number seem to differ – the budget reports about 8,200 positions will evaporate, while retirement system official indicate at least 8,400 employees are covered. Neither have layoff plans yet been presented to the Department of State Civil Service.) However, it is anticipated that the contractors will rehire around 90 percent of those laid off.

Essentially, HB 34 would allow those laid off to transfer their retirement contributions and those put in by the state to another retirement plan, and HB 35 would allow the early drawing of retirement benefits by those eligible in years served. This preferential treatment that almost certainly would increase costs to the state (final calculations have yet to be completed) Barrow justifies by saying “I don’t want employees to have to suffer because of decisions of the state. They did not choose to retire.”

Excess funds tussle exemplifies need for genuine reform

Reshuffling $120 million from a special district into state spending points out the absurdity of the present fiscal rules for Louisiana that create a counterproductive straitjacket, causing misallocation of revenues and complicating needlessly the budgeting process, as well as providing more posturing opportunities for politicians.

For this current year’s budget, $20 million of expenditures are to be drawn from the Ernest N. Morial New Orleans Exhibition Hall Authority. Next year, $100 million is budgeted to come from this source. This body was created in 1978, to oversee the operation of what is now New Orleans’ Ernest N. Morial Convention Center, as a special district government.

The state wants use of the money in order to fund activities in higher education, saying it will borrow them and then replenish them in kind over several years, treating the funds as unused capital outlay monies that eventually will go into some kind of construction, meaning future unused dollars for state capital outlay can go to paying them off. This upsets some Orleans legislators, such as state Rep. Jared Brossett whom calls this a “raid” and state Rep. Cameron Henry who says it’s “taking someone’s operating budget.”