Gov. John Bel Edwards has the Louisiana Legislature right where he wants them as lawmakers began an 18-day special session Monday night that he called to raise taxes.
The question is whether conservatives in the House will foil his strategy.
Edwards wanted to end the regular session Monday with legislators not fully funding programs that everyone agrees are critically needed — so legislators would feel enough political heat to approve taxes to pay for them.
The budget passed by the Legislature on Sunday night funds only half of the TOPS scholarship program while five safety net hospitals are short $100 million and the state’s colleges and universities are missing $55 million if they were to receive as much next year as they got this year. The budget also cuts spending for K-12 school spending by $44 million — the first reduction from one year to the next in decades — and does not contain money to open the new $24 million Acadiana Center for Youth, a 72-bed facility in Bunkie.
Edwards is asking lawmakers to raise more money by eliminating tax breaks for individuals and corporations and by raising a tax on insurance companies. In all, he wants to fill what he says is a $600 million gap.
Two leading House Republicans said in interviews Monday that they will not go along with Edwards’ plan.
“I would like to fund TOPS at 100 percent,” said state Rep. Cameron Henry, R-Metairie, who chairs the budget-writing committee. “But TOPS is only short this year. Do you permanently raise income taxes to fund TOPS this year?”
The answer for Henry is definitely no.
State Rep. Lance Harris, who chairs the Republican House caucus, feels the same way, even though Rapides Regional Medical Center, the Alexandria safety-net hospital in his district, is short $14 million from the state.
“I’m not voting for any new taxes unless we have meaningful spending and tax reform, and I don’t see that happening,” Harris said.
Asked whether he felt pressured to support higher taxes to fill the $14 million gap, Harris said, “I’m sure that will help him persuade some members. It’s not working for me.”
The governor sought to raise the pressure by meeting with key constituency groups Monday, including representatives from the sheriffs’ association, the safety-net hospitals and the state’s colleges and universities and their oversight boards.
“It would be pretty devastating for us if we come out of the special session without any more revenue,” LSU President F. King Alexander said in an interview. “We’re 2½ months from the start of the fall semester. Families are waiting to find out” if they will get full funding for TOPS.
Ben Nevers, Edwards’ chief of staff, said the governor has promised that if the Legislature raises $450 million during the special session, he would direct one third of that amount to TOPS, which would be enough to fully fund it.
In the House, virtually all Democrats and some moderate Republicans are expected to vote for at least some of Edwards’ tax measures, as is a majority of the Senate.
Republicans hold a majority in both chambers, but the Senate is more open to raising taxes.
Republicans in the House wanted the budget to provide full funding for TOPS and the safety-net hospitals in a way that the Senate and Edwards would not accept. That has left those programs short of what the governor says is needed.
“That’s what his goal was for the past month,” said Bernie Pinsonat, a pollster and political consultant. “He pulled it off. He is using TOPS and health care in a political way so legislators can vote for what he wants in increased revenue.”
Given the narrow time frame of the special session, the House Ways and Means Committee will begin taking up tax bills Tuesday morning after Edwards lays out his plan in a joint address to House and Senate members.
The key vote will come on House Bill 11, which would limit the deduction on state income taxes that individuals can claim from the itemized deductions they take on their federal tax returns that are in excess of the federal standard deduction. HB11 would restrict what is a 100 percent deduction to 57.5 percent, the rate in 2008. It would raise about $150 million.
A similar measure was opposed unanimously by Ways and Means during the first special session, in February, but the vote allowed the measure to go to the full House where it was defeated, 44-58. It needed 53 votes, a bare majority, in the 105-member House. There seems to be little appetite for another Edwards’ proposal that would change the state’s individual income tax brackets by making more taxpayers pay the top tax rate. A similar measure in the first special session raised over $300 million.
Follow Tyler Bridges on Twitter, @TegBridges.
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