Budget Deal Tricky To Reach In Final Days Of Lawmakers' Work

BATON ROUGE (AP) — Budget-balancing negotiations moved behind closed doors Tuesday with legislative leaders trying to strike a deal that would stop deep slashing to state services while also surviving the trip to Gov. Bobby Jindal's desk.

         The House and Senate have passed different packages of budget-balancing plans, and the House sent many of the financing bills to legislative conference committees to hammer out final versions.

         "It's about the numbers, trying to figure out the numbers," said House Appropriations Committee Chairman Jim Fannin, R-Jonesboro.

- Sponsors -

         But while disagreements emerged about how much to raise taxes, the biggest stumbling block wasn't necessarily the spending plans or even the tax hikes proposed to help pay for programs and services.

         Instead, one of the largest disputes was over whether lawmakers will agree to create — at least on paper — a way for Jindal, expected to announce his presidential campaign in two weeks, to continue claiming that he didn't raise taxes during his eight years in office. Tensions have steadily escalated between the House and the governor's office over the proposal.

         The legislative session must end Thursday by 6 p.m.

- Partner Content -

Entergy’s Energy Smart Program Brings Cost Conscious Innovation to New Orleans

Offering comprehensive energy efficiency at no cost to the consumer, Entergy’s Energy Smart program incentivizes Entergy New Orleans customers to perform energy-saving upgrades in...

         Jindal won't support any tax changes he — or national anti-tax activist Grover Norquist — considers a net tax increase. The Republican governor, however, has acknowledged the state has to raise revenue to help address a $1.6 billion budget shortfall for the fiscal year that begins July 1.

         That leaves some lawmakers looking for loopholes to get Jindal on board with tax changes while also drumming up new money to keep colleges and health services from deep slashing. If Jindal can't claim the package of financing plans doesn't raise taxes, he's threatening to veto some of the tax changes and forcing steep budget cuts.

         The Jindal administration is pushing to create as much as a $350 million tax break that doesn't lessen anyone's taxes, but that can be used to protect the governor's anti-tax record. The proposal would involve raising a new "assessment" on college students. The students wouldn't actually pay the fee because it would be covered by the state through a tax credit paid directly to colleges.

- Sponsors -

         It's a pass-through that doesn't provide any net new revenue to the state, to colleges or to students. But the creation of a tax credit counts by Norquist's Americans For Tax Reform organization as an offset to tax increases used to generate new money for the state's budget, like a proposed cigarette tax hike.

         The Senate has been willing to go along with the paper trick, but so far the House has balked. The House refused to adopt the language in three different bills it considered Tuesday.

         Critics call the tax credit a budget gimmick aimed solely at protecting Jindal's presidential ambitions.

         "This type of bill is simply an effort to trick the public and allow the governor to claim, on very specious grounds, that he didn't raise taxes," Rep. Jay Morris, R-Monroe, said in an email to his constituents.

         "Who the hell cares what Grover says?" Sen. Karen Carter Peterson, D-New Orleans, asked her Senate colleagues Monday.

         Supporters say they need the maneuver to keep financing bills for the budget from facing a Jindal veto that would force steep cuts onto higher education and health programs. But even they don't necessarily offer a strong defense of the proposal.

         "I'm not going to defend the merits of it. I think it's a rather peculiar way to set something up," said Rep. Alan Seabaugh, R-Shreveport, as he unsuccessfully tried to persuade his House colleagues to support the tax credit.

         – by AP Reporter Melinda Deslatte




Digital Sponsors / Become a Sponsor

Follow the issues, companies and people that matter most to business in New Orleans.

Email Newsletter

Sign up for our email newsletter