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Sunday, September 16, 2018



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Budget woes at the forefront as legislative session begins

Budget woes at the forefront as legislative session begins

BATON ROUGE, La. (AP) — With a hefty budget shortfall in the middle of an election year, lawmakers returned Monday to the Louisiana Capitol to sift through difficult scenarios: slash spending to colleges and health care, or find ways to raise revenue.

They'll have to maneuver around the national political ambitions of term-limited Gov. Bobby Jindal, who is expected to announce a presidential bid after lawmakers wrap up their work in mid-June.

The two-month legislative session is expected to focus heavily on Louisiana's finances, with the state facing a $1.6 billion gap for the budget year that begins July 1.

"I don't think there's any other issue as far as I'm concerned beside the budget, trying to get that in line," said Senate President John Alario, R-Westwego.

Legislative leaders, both Republican and Democrat, have been holding a series of closed-door meetings to discuss strategies. But they haven't coalesced behind a plan yet, instead hoping that when everyone's together in the Capitol, a package of ideas will come together.

Lawmakers have pre-filed a hodgepodge of proposals to scale back tax breaks, temporarily suspend tax breaks, raise cigarette taxes, increase college tuition rates and hike fees for state services.

Which ones will advance and what they'll look like is far from decided.

All that seems certain as the session opens is Jindal's proposal to scale certain business tax breaks to drum up new money for spending has hit strong resistance. Lawmakers don't believe it can pass in its current form.

"His plan falls short," said Sen. Robert Adley, R-Benton, one of the key negotiating figures in the behind-the-scenes budget and tax negotiations.

The Republican governor wants to cut more than $500 million in spending on tax credits that give businesses a check above their state tax liability, calling it "corporate welfare."

Business organizations call Jindal's proposal a tax hike.

The issue is sensitive for Jindal, who has guarded his reputation on taxes and refused to support anything considered a tax increase. To get around his self-imposed restrictions, the governor describes caps on refundable tax credits as reductions in state spending.

If lawmakers don't like Jindal's ideas, they'll need to work within his parameters against tax increases to avoid his veto. Louisiana's Legislature traditionally refuses to override a governor's vetoes. That has everyone looking for loopholes to raise revenue without the method being considered a tax hike.

"It does tie our hands quite a bit," said Rep. Jay Morris, R-Monroe. "It appears to be in the present situation difficult, because the governor is running for a higher office and he believes there are certain things he has to do in order to maintain his viability as a candidate."

Several lawmakers are trying to frame debate over Louisiana's generous tax credit programs — like for the film and solar industries — as direct subsidies to business. Shrinking those, they argue, is a reduction in state spending rather than a tax hike.

"The way I look at some of these tax credits, they're government expenses. So in my mind, I'm looking at doing some cuts," said Rep. Lance Harris, R-Alexandria, chairman of the Republican Legislative Delegation.

Adley said Louisiana's tax breaks have grown too large, topping $7 billion a year.

"You cannot give away everything that you have," he said.

Businesses targeted in the wide-ranging tax debate are gearing up for a fight, while higher education leaders and health care service providers are describing dire situations without additional funding.

The chair of the Louisiana Democratic Party, state Sen. Karen Carter Peterson, is pushing measures to expand the state's Medicaid program and to require paid sick leave for many full-time workers around the state.

"I'm determined to help lift folks into the middle class by reducing financial hurdles to their success," Peterson said in a statement.

But in a majority Republican Legislature, the ideas appear to be long-shots.

While finances are lawmakers' central focus, other contentious issues will mix into the session, including a debate over the Common Core education standards.

Jindal wants to get Common Core and its testing removed from Louisiana's public school classrooms, a push that faces resistance from the chairmen of the House and Senate education committees and business organizations.

A similar proposal failed last year, but the multistate standards have grown more unpopular since then and Jindal has made the repeal the centerpiece of his legislative agenda.

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