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Wednesday, July 24, 2019

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Governor slams inaction on taxes, says House wasting time

Governor slams inaction on taxes, says House wasting time

BATON ROUGE, La. (AP) — Gov. John Bel Edwards showed increasing frustration Friday with the House blockade of many of his tax proposals to stabilize Louisiana's budget, saying a "lackadaisical approach" threatens to devastate health services and college campuses.

"The Legislature has failed to produce any alternative to my plan that comes anywhere close to solving the problem. And to make matters worse, the Legislature's wasted multiple days this week when they should have been voting," the Democratic governor said.

While Edwards' comments were broad, he acknowledged his point of complaint was the House, where Republican leaders have bottled up tax bills that could be used to bail out the budget. Senators are more willing to consider taxes, but they are constrained because most tax bills must start in the House.

Louisiana faces an estimated $900 million hole for the fiscal year that ends June 30 and an even larger, $2 billion shortfall next year. The gaps threaten colleges and health care services for the poor and disabled with the deepest cuts.

Even areas where progress seemed to have been made this week took a hit Friday. A Senate proposal that appeared to get lawmakers closer to rebalancing this year's budget had a $75 million hole blown into it.
For days, Edwards has said he expected a deal would be struck to close both budget shortfalls. But on Friday, he said he was less optimistic.

The special session must end Wednesday.

"We have 5 days. We can get it done," Edwards said. "I'm not here saying that this has been a failure. I'm saying that if they don't move soon, if their lackadaisical approach continues over the next few days, then clearly we're not going to be successful and the implications of that are severe."

The House has agreed to a 1-cent state sales tax increase, a 22-cent per pack cigarette tax hike and some other modest tax changes. But lawmakers in the majority GOP chamber have stalled other tax measures sought by Edwards.

The governor urged the House to vote Friday on an alcohol tax boost, saying it would be the first increase in the tax since 1948.

"We're talking about three-quarters of a penny for a can of beer. I doubt that anybody out there would even know that the tax increase happened," Edwards said.

Senators thought they had unveiled a plan Thursday that whittled this year's budget shortfall down to $67 million with House-approved tax hikes, budget cuts and short-term financing patches. Senators were hoping the House would agree to raise that much in taxes to fill the remaining hole.

But the gap in the Senate plan grew to more than $140 million when financial estimates changed for one of the bills on which the plan relied.
The measure by Rep. Chris Broadwater, R-Hammond, would change the payment schedule under which businesses turn over sales tax collections to the state. By shifting the calendar, lawmakers and Edwards hoped to generate $75 million for this budget year.

Senate Finance Chairman Eric LaFleur, D-Ville Platte, said the Legislature's financial analysts, after taking another look at the bill, decided it wouldn't generate the money for this budget year. He said the problem appeared to be with the accounting method for collecting the taxes.

With a $140 million-plus problem, LaFleur said, "We're still within reach, but it was a lot nicer yesterday, because people could see the light at the end of the tunnel."
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