BATON ROUGE, La. (AP) — The budget passed by Louisiana lawmakers in the final frantic minutes of the special session will steeply reduce spending across much of state government and college campuses next month, because they failed to pass taxes to pay for a large portion of it.
Gov. John Bel Edwards is planning another special session later this month, hoping to reach a deal that would add more money into the spending plan for the financial year beginning July 1.
It remains uncertain, however, if the tax stalemate will end — or if the governor will veto the budget sent to him and ask lawmakers to try again in the next special session.
State officials Tuesday were sifting through the budget passed by lawmakers, which contains about $500 million in spending that wasn't funded, trying to make sense of what won't be getting money.
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BUDGET CUTS
If no further money is raised and agencies have to take the cuts proposed for them, Edwards and many lawmakers warn the cuts could be deep and damaging.
The more than $29 billion state operating budget crafted by the Senate and accepted by the House in the last half-hour of the special session shields health services for the poor, elderly and disabled from slashing. But an entire "supplementary section" of other spending plans needs additional revenue to be funded.
Without that money, the TOPS program would pay for about 70 percent of tuition costs for its more than 50,000 students in the 2018-19 school year. Higher education, which took large cuts to state financing over the last decade, would lose more than $90 million more.
Jim Henderson, president of the University of Louisiana System, said the budget would default "on the promise of TOPS earned by tens of thousands of students" and hit a higher education budget that is "already ranked last in the nation in per-student funding."
The child-welfare agency, public safety programs, K-12 education programs, sheriffs and a wide array of state government agencies also would take sizable hits.
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MONEY RAISED
Though they didn't broker a compromise on the major sales tax bill, the House and Senate did agree on about $80 million to go toward that supplementary section of the budget.
Lawmakers steered oil spill recovery money away from trust funds to state operating expenses. They also scaled back an individual income tax break that Louisiana allows for taxes paid to other states.
But the House's budget advisers and the Edwards administration believe that gaps in the budgets for legislative and judicial agencies have the first draw on that additional $80 million.
The remaining money will be applied on a pro-rata, across-the-board basis. Barry Dusse, director of Edwards' Office of Planning and Budget, estimated Tuesday that after the legislative and judicial agencies get full financing, about $19 million is applied to the rest of the list.
That leaves $500 million in the spending plan without financing.
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SESSION MELTDOWN
Louisiana is estimated to bring in $648 million less in general state tax dollars next year, a shortfall tied to the expiration of temporary taxes.
Tax negotiations largely centered on the expiration of a 1 percent sales tax hike that would drop the state sales tax rate to 4 percent in July. The Senate agreed to renew one-half of the expiring tax, to have a 4.5 percent sales tax rate on July 1. That bill would have fully financed the budget that passed.
House lawmakers disagreed on the rate on the last day of session, with a bipartisan majority supporting a 4.5 percent rate and House GOP leaders pushing a 4.33 percent rate that garnered about one-third House support. Neither proposal reached the two-thirds threshold to pass before Monday's midnight deadline.
– by Melinda Deslatte, AP reporter
