LA Gov. Edwards Shifts Strategy For Tackling $1.5B Budget Gap
Gov. John Bel Edwards
BATON ROUGE (AP) — With his tax plans repeatedly blocked by House lawmakers, Gov. John Bel Edwards is broadening outreach efforts, trying to build grassroots pressure for stabilizing Louisiana's budget and closing the latest looming, $1.5 billion-plus mid-2018 budget gap.
That's the official price tag in documents to be presented to lawmakers today, the first update since the legislative sessions ended in June.
Most of the shortfall projected for the budget year that begins July 1, 2018, is tied to the expiration of temporary sales taxes enacted by lawmakers last year.
The rest of the budget hole accounts for rising costs expected for prisoner housing, elections, the Medicaid program, K-12 public schools and other inflationary expenses.
The Democratic governor met with business leaders this week to brainstorm budget-balancing ideas. His chief financial adviser, Commissioner of Administration Jay Dardenne, is on the traveling speech circuit, making the case for revenue rather than cuts to close the gap.
The reworked strategy appears aimed at getting community leaders involved in influencing the GOP lawmakers who have stymied Edwards' previous attempts to rewrite Louisiana tax laws to permanently drum up money for the treasury.
Dardenne said the governor believes the administration has an obligation "to educate as many people as we can, so that there are knowing decisions made and so that the public can convince their legislators what they want." He said the effort was a "reality check" about choices, either making deep cuts across government services or replacing expiring taxes.
"If the public appetite is for no replacement revenue, then let them say, 'Don't raise any taxes, cut the billion dollars.' And then we'll start closing things and see what happens then," Dardenne said Wednesday after his speech to a local Rotary Club. "We won't have any other choice. It's not what we want to do obviously. We want to find acceptable revenue measures."
About $1.1 billion in temporary sales taxes are expiring when the next budget year begins on July 1, 2018, a drop-off called the "fiscal cliff." Lawmakers passed the taxes to fill financial gaps until they tackled a comprehensive overhaul of budget and tax laws.
That overhaul hasn't happened. Tax proposals offered by Edwards — and the tax ideas put forward by a nonpartisan study group — failed to win support in the House, with GOP leaders opposing the measures and pushing deeper cuts to the budget.
No one, however, has come up with a plan to make more than $1 billion in cuts. Louisiana has a $28 billion operating budget, but the cuts would have to come from the state's general tax dollars, known as the general fund. That fund is $8.6 billion this year.
Dardenne's speech, also presented in Alexandria this week, seeks to make the administration's case that the budget hasn't ballooned like some Republican lawmakers insist. The figures cited by Dardenne show growth in the budget driven by increased federal financing, while the state's general fund revenue has fallen over the last decade.
He gave the room a call to action: "You need to be heard. You need to weigh in."
A day earlier, Edwards met with 21 business leaders for a similar, closed-door discussion.
"It's their ideas, combined with the input from legislators and other community leaders that will hopefully guide us as we look for consensus to avoid the fiscal cliff," he said in a statement.
Edwards and Dardenne also plan regional meetings with lawmakers to hash out ideas.
Edwards sent a letter in July to House Speaker Taylor Barras, calling on him to outline his proposals and to convene a bipartisan group of lawmakers to negotiate with the governor's office. Barras hasn't responded to the letter.
The House speaker didn't return calls for comment. Alexandria Rep. Lance Harris, chairman of the House GOP delegation, has said it's Edwards' job as Louisiana's top leader to devise ideas for addressing the shortfall and to try to persuade lawmakers.
– by AP Reporter Melinda Deslatte