Budget battle simmers as lawmakers recognize additional tax revenue

Budget battle simmers as lawmakers recognize additional tax revenue

BATON ROUGE, LA (WAFB) - The Revenue Estimating Conference (REC) formally recognized $110 million in additional revenue Wednesday, April 10 for this year’s budget, easing tensions and effectively ending a battle between Republicans and Governor John Bel Edwards’ administration.

In an unprecedented maneuver, House Republican leadership blocked four prior attempts to recognize a rosier outlook for the state’s finances, ignoring the state economists’ insistence that a strong year for corporate and personal income in Louisiana would result in more tax revenue.

House Speaker Rep. Taylor Barras, R-New Iberia, said he wanted to delay the projections so the economists could gather more data in order to make a more accurate prediction.

“We’re now dealing with nine months of data, which, in my opinion, gives us a much more accurate number,” Barras said Wednesday after he agreed to recognize $110 million. “At some point, you have to go with the numbers you have and that’s why I was hoping to wait until today to reach that number.”

The estimate for additional revenue did come down by almost $20 million from the economists’ November 2018 proposal, although the fall estimate is customarily replaced with subsequent projections as new data comes in each quarter. The state must formally adopt a revenue estimate, and lawmakers cannot spend any money that is not recognized.

Gov. John Bel Edwards
Gov. John Bel Edwards (Source: WAFB)

The legislative session convened Monday, April 8 with two competing budgets that both incorporated money the REC had not recognized. Instead of issuing a budget with the most recent REC-approved revenue numbers from June of 2018, the Edwards administration chose to create a budget wish-list that assumed some additional money would be recognized. The new estimate will not pay for all of Edwards’ wishes, but will come close.

“This whole exercise has been a frustrating one and a confusing one for people, but the bottom line is that we finally have the estimate that we need for the legislature to go forward and decide how to spend the money," Commissioner of Administration Jay Dardenne said.

“Hopefully, we will not have a situation like this again," he added. “It’s an election year and there’s a lot going on, but this is not how the business of the people should be handled.”

The approval all but guarantees teachers will receive a uniformly-supported raise, and it will give lawmakers the opportunity to have more normal budget negotiations based on priorities.

Repeated fiscal crises overshadowed budget debates for nearly a decade.

“It’s going to be a much easier session than we’ve seen in the past because there is no uncertainty about revenue now," Dardenne said. “That’s not to say it’s going to be sweetness and light the whole time; I think there are going to be debates about how money is spent, but that’s what the legislature is here for.”

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