Gov. John Bel Edwards has scheduled the year’s third special legislative session devoted to trying to pass tax bills and spare Louisiana from large state budget cuts for June 18 through 27.
Edwards announced the dates for the special session Friday (June 8) and that he had approved the budget lawmakers approved at the conclusion of their second special session that ended Monday.
The governor, a Democrat, and the Republican-controlled Legislature have failed three previous times — during a regular session in 2017 and in two special sessions this year — to resolve the state’s budget and tax woes.
The upcoming session has to end three days before a budget plan that includes dramatic cuts to higher education, housing prisoners, child welfare services, district attorneys and the TOPS scholarship program is scheduled to go into effect July 1. Lawmakers will be able to avoid those budget reductions if they pass new taxes during the 10-day special session.
The House Republican leaders had requested that Edwards allow them to introduce bills that they thought would help control government spending and provide more transparency during the next special session.
“We agree in the necessity of funding our essential priorities. We also believe that it is necessary to enact transparent budgeting and spending policies and reduce the size of state government,” wrote House Republican Caucus chairman Lance Harris of Alexandria, in a letter to the governor of behalf of House GOP members.
Edwards rejected their request. The governor — who has control over what types of bills can be discussed in the special session — essentially has only left changes to Louisiana sales tax rate and exemptions be considered by legislators later this month.
The legislation House GOP leaders wanted — which would put a stricter spending cap on state government — had already been considered in one previous legislative session and never made it all the way through the process. So Edwards argued it would be redundant to introduce it again.
In the most recent special session though, House Speaker Taylor Barras, R-New Iberia, complained Edwards didn’t allow for the type of spending cap proposal the Republicans wanted to be brought back up again. Bills are also often introduced more than once before they make it all the way through the legislative process.
Edwards said another measure the House Republicans are pushing — to give the legislative auditor access to more financial records — wasn’t needed because the auditor already has that authority.
House Republicans would disagree with Edwards on that point. They have said the auditor has problems getting certain kind of financial records, including those related to the private hospital corporations that run facilities for the state.
Those arrangements for the private companies to run public entities were struck under Gov. Bobby Jindal, a fellow Republican, and have been widely criticized by Republicans and Democrats alike.
Though he didn’t listen to most House Republicans’ demands, Edwards did announce Friday he had signed legislation from the recent special session which would expand a government spending transparency website to make it easier to figure out where state funding is going.
The House Republicans had asked him to approve this bill, but funding to build the website isn’t available currently. The transparency program is contingent on the Legislature agreeing to pass more taxes in the next special session to fund the measure.
“I will point out that the Legislature did not fully fund [the transparency project], which will delay bringing additional agencies online,” Edwards wrote to the House Republican leaders.
In the version of the budget Edwards and the Legislature have approved, health care services, the judicial system and the Legislature are spared from cuts. But the reductions to corrections’ funding is so dramatic that officials have said it would require 10,000 inmates to be released earlier than expected over the next year.
The cuts to higher education total $96 million, and every student getting a TOPS scholarship would also only receive about 70 percent of what they expected for the 2018-2019 academic year, under the budget.
The state faces a financial shortfall because the state sales tax rate is scheduled to fall from 5 percent to 4 percent in July, when the new budget takes effect. Republicans and Democrats have agreed — sometimes reluctantly — to keep a higher sales tax rate in place, but there is a debate about how high it should go.
The House Republican leadership was only willing to raise the sales tax rate to 4.33 percent, which will still require some significant budget cuts. Senate Republican leaders, Democrats and the governor were pushing for a 4.5 percent rate.
The difference between these two rates is relatively small — just 17 cents on a $100 purchase. Nevertheless, neither sales tax rate could get enough support to pass the House in the previous special session that ended Monday.
Tax bills need a super majority — 70 votes — to get approved in the House. Some Democrats and some Republicans must agree on a proposal to reach that mark. It typically takes almost all Democrats to get a tax bill out of the House because many Republicans refuse to vote for any tax at all.
The coming special session will also include some new dynamics that will make it harder to navigate. Edwards is not allowing the Legislature to reconsider the budget plan that’s been approved. That means the spending plan that is in place will be enacted, regardless of how much tax revenue is raised.
It also means legislators won’t be able to target where they want any tax revenue they raise to go. All the areas of the budget — corrections, child welfare services, higher education and TOPS — will receive any tax revenue that is agreed upon at a proportional rate. Essentially, legislators won’t be able to send tax revenue to a specific area — such as public universities and colleges.
Legislators also won’t be able to rearrange budget priorities in the special session. This could irk Republicans in particular, who won’t be able to cut health care funding or Medicaid services to pay for another area of government they might consider more important — as they have proposed in the past.
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