UPDATE: The budget negotiations collapsed at the last minute. See here for more.
The Times-Picayune’s Julia O’Donoghue has a long piece this morning on the slow-moving negotiations between Louisiana Senate Finance Committee chair Eric Lafleur and his counterpart, House Appropriations Committee chair Cameron Henry, on a budget deal which must be struck by 6 p.m. today.
It comes to a lot of wrong conclusions, but it’s worth a read anyway.
The upshot of the piece is this – the Senate’s budget spends $206 million more than the House’s budget did, and leaves zero projected revenue in reserve in the event the state’s Revenue Estimating Conference, which has issued inaccurate (read: overly optimistic) revenue projections no fewer than 15 times in the past nine years, is wrong yet again. And Lafleur, presumably on orders from Gov. John Bel Edwards who has publicly sneered that he will veto the House budget, so far refuses to come off that number.
Meanwhile, Henry has offered to close the gap to $154 million, offering up $52 million more in spending. Edwards’ response to that offer was that it was “no better” than the original House budget.
It’s $52 million better, from Edwards’ perspective, but it’s no better. This is a supposed adult who is in charge of a state with 4.5 million people in it.
Meanwhile, Lafleur decided he’d hold a Senate Finance Committee meeting yesterday, as more or less a kangaroo court for the House budget, and invited the three House conferees to be put in the hot seat…
The committee doesn’t typically hold budget hearings this late in the session. LaFleur arranged the hearing — to a certain extent — with the hope of pointing out why the latest House budget proposal was unworkable. Henry, Barras and Smith were invited to attend the hearing on the behalf of the House. Only Smith, the one Democrat, showed up to speak with the senators.
Even some of the other Senate Finance Committee members appear irritated by the meeting, though. The committee has already held dozens of hours of testimony about the budget and potential spending cuts over the last few weeks.
“Mr. Chairman, with respect, what do we expect to gain out of this hearing?” Sen. Bodi White, R-Baton Rouge, asked LaFleur.
Most of the meeting focused on what the House budget proposal might mean for higher education. The Senate has proposed giving Louisiana’s public colleges and universities all the money they requested, for the first time in a decade. The House proposal would make them take a $19 million reduction.
All of the higher ed folks were there, and the basic message was they didn’t like the House’s idea to fully fund TOPS if they had to take that $19 million cut. Which is an uncommonly stupid position to take.
Louisiana’s bill for the TOPS program is around $300 million, and last year it was funded at only 70 percent – meaning higher education, through TOPS, was cut by $90 million. That funding is being restored in both the House and the Senate budgets.
Meanwhile, the $19 million cut in the House budget is a remnant from a cut initially proposed by Edwards in his budget. It’s a two percent cut which was part of an across-the-board reduction the governor had put in place, and Henry kept it in his budget. The Senate is restoring that $19 million; nobody in the House really has a problem with that as a path to a budget deal.
But LSU president F. King Alexander actually said that he would rather have TOPS, which LSU greatly benefits from, get cut than have to absorb LSU’s part of the $19 million. He actually said that, knowing that only a seven percent reduction of TOPS dollars would come to more than $19 million – and since all of the in-state students LSU admits qualify for TOPS, he’d be absorbing a lot more of a TOPS cut than he’d absorb out of a general fund appropriations decrease to higher ed.
If this is making you think F. King Alexander can’t count, remember this – LSU’s tuition is LSU’s tuition, whether TOPS covers it or not. So if TOPS gets cut, he’s just taking that money out of Mom and Dad’s bank account, which means F. King Alexander just showed Mom and Dad precisely what size fig he gives about their household budget problems.
F. King Alexander, by the way, gets something like a $17,000 per year car allowance on top of his $600,000 annual salary. That’s how destitute LSU is.
They’re ultimately going to reach a budget deal today. That deal will result mostly from the House giving ground on the $154 million they currently propose to hold in reserve as a hedge against the REC’s projections being wrong, because as we’ve written Henry has already won the argument – what’s not being proposed is to raise taxes to meet some fantasyland, wish-list budget. The REC will be wrong, and the budget will end up in deficit more than likely, but the figure will be relatively small and manageable. Given that, the House will let the Senate have some – but not all – of that $154 million.
But what you see now is what sore losers Edwards and his allies are. You’re also seeing what slavish toadies to Edwards the state’s newspapers can be. That O’Donoghue reported Edwards’ position that a $52 million concession is no better than no concession at all as a valid, normal position for a governor to take in a budget negotiation tells you all you really need to know about whether they’ve taken sides.
UPDATE: Now, it appears a deal is about to be struck…
Speaker Taylor Barras, R-New Iberia, has agreed with the Senate’s demand that the state authorize the full amount of available spending next year but is insisting that state agencies set aside $50 million to cover any revenue shortfall that might develop, state Sen. Eric LaFleur, D-Ville Platte, the Senate’s lead negotiator, said in an interview Thursday morning.
The deal is acceptable to the Senate, LaFleur said, adding that Barras was seeking approval from House members.
In other words, it’s like we said earlier in the week…
Henry’s happy to meet in the middle on that aspect of the Louisiana budget. He’s won. At this point the question is how convincingly he’s won. But just like LSU head baseball coach Paul Mainieri would probably have been happier with a 10-0 victory over Rice Sunday night rather than the 5-0 victory he won, Mainieri is plenty satisfied with an NCAA regional championship and a berth in this weekend’s Super Regional.
The fundamental parameters of the state’s budget hold that no taxes will be raised to meet unrealistic amounts of government spending, and some projected money is held in reserve as a hedge against the likely circumstance that the REC’s projections will be wrong.
The House has won, and the Senate and the governor look like clowns. Rightfully so. Look for a firestorm of name-calling and whining as soon as the session ends this evening in order to mask that fact.