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Wednesday, April 24, 2019

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Wednesday session deadline near with no tax deal reached yet

Wednesday session deadline near with no tax deal reached yet

BATON ROUGE, La. (AP) — With a session-ending deadline fast approaching, the Louisiana House and Senate were trying to strike a deal Monday to keep from cratering this year's budget and forcing widespread cuts on health care and colleges.

But House Republicans have rejected several tax measures the Senate, House Democrats and Gov. John Bel Edwards had hoped could be used to drum up new money for the treasury.

The House late Sunday spurned bills that would lessen business tax breaks, including a proposal to lower a sales tax exemption for business utility costs. Lawmakers may try to bring the measures up again Monday.

Rep. Walt Leger, D-New Orleans, said the House must start passing tax bills to keep furlough notices from going out later this week on university campuses and across state agencies. Leger said a state museum worker recently asked him if he would be laid off.
"We've been looking at so many numbers we sometimes forget the people involved," Leger said.

The special session must end by 6 p.m. Wednesday.

Edwards called the 25-day special session to close gaps in Louisiana's budget estimated to reach $900 million this year and to top $2 billion in the fiscal year that begins July 1.

Lawmakers have agreed to patchwork financing and spending cuts. But they've not agreed on enough taxes to fill the remaining holes, leaving colleges and health services at risk of steep slashing. Lawmakers are about $150 million to $200 million short of rebalancing this year's budget and even further away on balancing next year's spending plan.

Several House Republicans have been urging colleagues to reconsider their stances against tax changes, particularly those that could raise taxes paid by businesses. Rep. Rob Shadoin, R-Ruston, cited the threat of deep budget cuts that risk shuttering college campuses midsemester and keeping students from finishing their coursework.

"For goodness sakes, the worst thing that could happen is for us to leave here and to not have addressed the problem for the people of Louisiana," Shadoin said, unsuccessfully urging the House to get rid of some state sales tax exemptions.

House GOP leaders are floating a proposal to balance the rest of the budget with a sales tax higher than the 1 percent increase already backed by the House, Senate and Edwards. But that faces opposition from the Democratic governor, who said he wanted more "shared sacrifice" from businesses.

Louisiana charges a 4 percent sales tax rate on purchases, or 4 cents on each dollar paid. Both the House and Senate have supported a 1 percent increase starting April 1.

Some House Republicans are suggesting a temporary increase that could go higher, somewhere below 2 percent, over anywhere from two to five years, until lawmakers take a larger stab at tax reform.

"It's still a viable option at this point," said House Speaker Taylor Barras, R-New Iberia.

Sales taxes raise large amounts of money quickly. A higher sales tax is attractive to Republicans because it doesn't face opposition from the state's largest business lobbying groups. But Democrats say the tax hike would heavily hit the poor.
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