The Louisiana House of Representatives has now passed its version of the budget, balanced with currently available revenue. As usual the governor is putting out “end of the world” statements even though everyone knows that the House budget is only a starting point for continuing budget work.
As I see it there are two paths forward. We could do as the governor is demanding and kill the budget that the House has passed, then move into a “clean slate” special session. The problem with this idea is that we would be starting over completely from scratch. That means that we would probably need a very long and expensive special session as we will have to start the budgeting process all over. Ultimately the result would probably be that we would end up in the same place anyway as there is nobody who believes that the House will suddenly change its long-held position on holding the line against the growth of government.
The other approach, the one that I and a great many of my colleagues support, is to have the Senate adjust the House version of the budget to its way of thinking and then complete the interim budget process aligned with the understanding of moving immediately into a special session. This session would be short and efficient because the interim budget presents a baseline of spending and allows us to determine exactly how much we need to flesh out the actual spending needs of the agencies. Then we can pass revenue measures that fulfill our needs and that are long term.
Just so that the noise and confusion in the media and from the governor’s office doesn’t confuse you, this latter approach is exactly the strategy envisioned when we Republicans refused to go along with the governor’s original demand for over a billion dollars in new taxes in his first special session. History has shown that his attempted tax grab was grossly over-inflated and that the decision to shut down the first special session was the right one.
Now we face a similar critical point. Should the governor prevail, be assured that his goal is to use a “clean slate” special session to try to wring as much out of taxpayers as he can. He is in a bad place and he must create as much income as possible because Medicaid in Louisiana alone will add about $100 million per year, every year, to our expenses. If he pulls this off he can avoid having to justify such major expense increases year over year. If not, we can follow good budgeting practices, spending aligned with revenue.
Without a doubt we need additional revenue. There is no one who truly believes otherwise, but such revenue can take the form of a renewal of sales taxes at a substantially reduced level plus elimination of some exemptions and credits. Once we pass an interim budget, we can calculate the exact amount that we need and incur only as much in taxes as are necessary.
The only way to control the growth in state spending and to fund true state priorities is to control the budget process. If the history of his attempted tax grab during the first special session is prologue, allowing the governor to use fear tactics to induce us to start all over will assure a strong chance that the amount raised will greatly exceed the amount needed. That will only exacerbate our already decimated economic condition.