HITHER AND YON: The House Wins The TOPS Deferment Battle

John Bel Edwards backed down. He did so kicking and screaming, but he backed down.

Though he called it bad policy, Gov. John Bel Edwards upheld the front-loaded approach to the TOPS program that aims to give college students full tuition funding for the fall semester and only 42 percent financing for the spring.

As the new financial year began Friday, the Democratic governor announced his signing of the budget bill passed by lawmakers in the special session that ended a week ago, to spend the $263 million raised through various tax changes.

While he issued two line-item vetoes, he left the TOPS language intact despite his opposition to its inclusion. He said striking the provision “would likely lead to litigation that would cause significant uncertainty and chaos mere weeks before the fall semester begins.”

But he made it clear in a letter to Senate President John Alario, R-Westwego, and House Speaker Taylor Barras, R-New Iberia, that he was unhappy with the TOPS approach.

“This scheme does not give students the ability to fully prepare for the spring semester and significantly complicates applications for financial aid,” the governor wrote.

Edwards also pointed out that the front-loading likely still won’t give TOPS students full tuition coverage in the fall, because not enough money was provided in the provision to cover tuition hikes that schools might adopt.

The point of applying cuts to the TOPS program wholly in the spring rather than across the board, as we discussed last week in this space, is that many lawmakers in the House believe there will be more revenue coming into the state’s coffers thanks to Edwards’ massive tax increases than was advertised in the fiscal notes on the bills those tax increases were packaged in (not to mention rising oil prices will result in a good deal more revenue than is currently projected). And if they’re right, the $88 million in cuts to the TOPS program can be restored by the spring, so that the parents of TOPS recipients won’t actually be forced to make up any tuition shortfalls arising from an underfunding of TOPS.

Edwards didn’t want to go along with that, because to do so means he’ll have less freedom to move money around – whatever revenue windfall might come out of those tax collections is going to have to go into the TOPS shortfall, and that wasn’t his preference. His letter to Alario and Barras is a joke – he couldn’t care less about TOPS parents, and he’s shown that time and time again. He wanted to apply a 30 percent cut to TOPS with two months’ notice, after all, and he couldn’t find $88 million to fully fund TOPS out of a $2.38 billion increase in the Department of Health and Hospitals budget.

Cutting TOPS was a political act, pure and simple. Most of the TOPS parents are middle-class white people, who either paid more for a house so they could live in a good public school district or they coughed up thousands of dollars a year in private school tuition in an effort to give their kids enough educational resources to earn the payoff of an academic college scholarship. Those people usually vote Republican, so going after TOPS was an exercise in payback to them and it was also an exercise in leverage – getting them to break from their normal politics in order to support his tax increases.

The legislature bent but didn’t break on that issue, and insured that if the cuts do come the fallout from them will land on Edwards’ head – for the next six months the primary conversation in Louisiana will be the challenge to Edwards to find a way to stave off a 60 percent cost increase in the spring semester for TOPS recipients, and whatever shortage there is will be his fault. Nobody cares about their state legislator; the governor gets all the blame in Louisiana when things go wrong.

Edwards created the box he found himself in on TOPS. He made the best decision available to him, but it comes with a cost; he can’t continue that leverage on TOPS parents anymore.

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Is it just us or are we seeing proof that the Film Tax Credit gambit is a total failure?

When the state decided to put a cap on those lucrative Hollywood South tax credits, the power-brokers we’re paying attention. One group, the Louisiana Film and Entertainment Association, claims business is off by as much as much as 90 percent in the last year.

Hollywood South at one point turned out some 1,100 productions between 2008 and mid 2015. It also shelled out $1.8 billion dollars in tax incentives — incentives state officials said it could no longer afford.

Now, Louisiana has gone from darling to Hollywood castoff, with a new cap of $180 million dollars a year. This has allowed Georgia, Kentucky and Canada to load up on productions.

The whole point of instituting tax credits to get TV and movies to film in Louisiana was to incentivize the growth of a film industry in the state and turn Louisiana into a competitor in the motion picture industry to Los Angeles and New York. It was thought that eventually, the industry would become robust enough that it would stay in Louisiana even without the tax credits.

But what we’ve seen is that industry doesn’t put down roots, and the major players in it do their principal business in New York and L.A. You’re not going to get film production companies to relocate from Hollywood to New Orleans or Shreveport from tax credits. What you’ll get is their willingness to fly people in to shoot TV and movies in your state if you pay them to do it, but when the shooting is over everybody goes back to Hollywood until the next picture gets shot here.

And the economic impact the whole thing generates isn’t enough to be worthwhile.

Had the film tax credit made for the creation of an actual industry in Louisiana, had there been film production companies springing up here and using those tax credits to put Louisianans and assorted transplants to work making movies and TV shows thought up, financed, produced and profited by Louisiana citizens, it would have been smart policy. But that didn’t happen. Turns out that with the film industry you get what you pay for, and only what you pay for. Sometimes, you don’t even get that – what you get is scammed.

It’s probably a good time to kill that tax credit completely, or if it’s to remain, to qualify for it you’d need to have a permanent presence in the state.

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For Today’s Last Thing, we go out to California where an old friend is doing quite well…

Former LSU superstar Alex Bregman is playing for the AAA Fresno Grizzlies in the Houston Astros’ organization, and it’s only a matter of time before he gets called up to the big leagues. He’s been in AAA ball for a grand total of five games and he’s hitting .476 (10 for 21) with four home runs, two doubles, 11 RBI, nine runs and a pair of walks.

The video showed the second of two homers he hit last night for the Grizzlies. He’ll be at Minute Maid Park in Houston by the end of the month, and we predict his big league career won’t end for a long time once it starts.

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