Louisiana Spotlight: Lots of talk, no deal on 'fiscal cliff'
BATON ROUGE — Louisiana’s governor and lawmakers have had no shortage of meetings about the impending “fiscal cliff,” when more than $1 billion in temporary taxes roll off the books and create a giant hole for the budget.
But so far, those meetings add up to a lot of talking and still no plan for closing the gap, as the months roll by and the cliff grows nearer. A House fiscal retreat held earlier this month wrapped up with lawmakers in the chamber saying they intend more meetings.
The $1 billion-plus shortfall hits July 1, with the start of the 2018-19 budget year. Though the state’s operating budget tops $28 billion, any cuts would come from the $9.4 billion general fund, the portion of money funded by state taxes, limiting which agencies would take the hits.
No one in the Louisiana Capitol has suggested a detailed list of cuts to strip that much money without devastating public colleges, the TOPS tuition program and health care services.
There’s a tacit expectation that some package of tax changes — whether removal of tax breaks, renewal of the expiring 1 percent state sales tax or something else — will be required to avoid deep, damaging reductions.
The conversations suggest officials understand the gravity of the looming shortfall and the implications for state services. Eventually, however, someone elected to help lead Louisiana has to step forward publicly with ideas, or everyone’s careening off the cliff together.
Gov. John Bel Edwards has held closed-door meetings to discuss the state’s finances with business leaders and local elected leaders around Louisiana, with the last ones planned this week in Lake Charles.
“I believe that we all hold a piece of the puzzle to enacting meaningful budget stabilization and reform,” the Democratic governor said after meetings in Monroe. “The pending $1 billion fiscal cliff is a collective problem requiring a collective solution.”
Edwards’ office says the governor will release a report about those meetings in November. Whether that will form the basis for a package of tax proposals remains unclear.
The governor’s roadblock in his previous effort to address the fiscal cliff was the majority-Republican House, where most tax bills must start and where nearly all tax bills were stymied. House GOP efforts to shrink state spending to lessen the size of the budget gap also failed.
Any tax plans will require a special legislative session to consider. Edwards wants to hold such a session early next year, before the regular session in which the next budget will be built. But the governor said he won’t call a special session unless he can reach agreement with House GOP leaders on what tax proposals they will support.
Senators are having their own conversations, but they are largely hamstrung until the House can reach a consensus.
Republican House Speaker Taylor Barras has traveled the state to visit with House lawmakers and has sat down with Edwards several times to discuss the budget.
Individual groups of legislators also have been gathering to talk about options.
Nearly two-thirds of House members attended a bipartisan, closed-door retreat this month to hear financial updates and hash out budget ideas.
“We know there are no easy solutions. We need to decide on two to three scenarios to solve this crisis, then find the votes,” Minden Rep. Gene Reynolds, leader of the House Democrats, said in a statement after the gathering.
Alexandria Rep. Lance Harris, head of the House GOP delegation, described it as “the first step in moving us forward to resolving our problems.”
Then, Harris described more meetings.
“From this point forward, we will be meeting as separate delegations and then come back together, hopefully with solutions,” he said in a statement.
Barras doesn’t seem inclined to spearhead his own plan, instead describing a consensus approach. On Thursday, he said the fiscal retreat opened “the floodgate for ideas” and “created lots of scenarios to consider as we go forward.”
“By the end of the year, December, certainly we will have a feel for where members are with the proposals. What finally coalesces, that could come sooner, that could come later. It’s hard to make that call,” he said.
Additional meetings are planned.
Melinda Deslatte has covered Louisiana politics for The Associated Press since 2000. Follow her at http://twitter.com/melindadeslatte