Since the Louisiana Legislature first took up tax bills in February, the state House has been more averse than the Senate to raising more revenue, and that pattern was on display again Thursday, one week before the special legislative session ends.
The more conservative House did not take up a major tax bill supported by Gov. John Bel Edwards after the measure’s sponsor said it wouldn’t pass.
House Bill 38 would raise $113 million next year by limiting a tax break that goes to the 23 percent of taxpayers who itemize deductions on their federal income tax returns. They are mostly people who earn at least $100,000 per year.
State Rep. Malinda White, D-Bogalusa, the sponsor, said she plans to ask the House to take up the measure on Sunday afternoon, in hopes that she and other supporters can win over the necessary converts by then.
Meanwhile, the state Senate approved two new tax bills Thursday that would raise $189 million next year.
Senate Bill 10 would force large manufacturing companies to choose between two lucrative tax breaks. SB10 would raise $139 million by making companies that qualify for both to choose between claiming the industrial tax exemption or the inventory tax credit. Sen. Rick Ward III, R-Port Allen, is the sponsor.
Senate Bill 6 would raise $50 million by eliminating tax rebates — but not the tax credits — taken by big companies on their inventory taxes. State Sen. JP Morrell, D-New Orleans, is the sponsor.
The next step for SB10 and SB6 is to win passage from the House Ways and Means Committee.
Rep. Neil Abramson, D-New Orleans, the committee chairman, did not respond to a text Thursday afternoon asking whether he would schedule the bills.
Edwards has been saying for several weeks that the Legislature needs to raise $600 million to prevent deep cuts to the state’s medical schools and safety-net hospitals, public colleges and universities, the Taylor Opportunity Program for Students scholarships, the prison system and K-12 schools. Those cuts will take effect on July 1 when the new fiscal year begins.
Senate President John Alario, R-Westwego, said earlier in the week that he would be “awfully happy” if the Legislature raised $450 million of the $600 million, but that now seems a stretch.
The House and Senate have both approved measures that would raise $222 million next year. The $113 million from White’s bill would take that to $335 million.
Adding the $189 million from the Ward and Morrell bills would take the $222 million to $411 million.
Given the House’s opposition to taxes, the Legislature may raise no more than the $222 million.
To reach the $222 million, the Legislature has approved or is about to approve House Bill 25, which reduces a tax credit available for policyholders of Citizens Property Insurance; House Bill 29, which gives the Revenue Department 90 days before it has to begin paying interest to corporations that make overpayments; and House Bill 35, which raises a tax on health maintenance organizations.
If the Legislature raises only the $222 million, House Bill 69, filed Thursday by state Rep. Cameron Henry, R-Metairie, provides an initial look at how lawmakers would allocate the money to fill the shortfall.
For example, TOPS, which is short about half the money the program is receiving this year, would end up about 25 percent short. The safety-net hospitals would get all of the $55 million that they are short.
Edwards, White and their allies, though, are on the hunt for more revenue by trying to attract the 10 or so Republicans needed to win passage of her HB38.
A Democratic tick sheet Thursday at lunch showed that the measure had only 46 of the 53 votes needed to pass the 105-member House. It was approved by the House tax committee Wednesday on a 10-9 vote.
“It’s frustrating,” White said in an interview. “On some of them, it falls on deaf ears. They’re just ‘no’ on everything.”
State Rep. Lance Harris, of Alexandria, who chairs the Republican caucus, said the opponents are reflecting the view of constituents who don’t want to pay higher taxes.
If the House does pass HB38, the Senate seems likely to follow suit, although the measure would be in place for only two years thanks to a complicated amendment drafted by Abramson to win his support and get the measure out of his committee on Wednesday. A platoon of business lobbyists are trying to kill Ward’s SB10, which passed the Senate 23-14 on Thursday.
“We’ll be letting legislators know we oppose it,” Stephen Waguespack, the president of the Louisiana Association for Business and Industry, said afterward.
Alario, though, has a different view of its prospects in the House.
“Hopefully, they’ll take a good look at this bill,” he said in an interview, adding that passage of the measure likely would ensure full funding of TOPS.
In a surprise, Harris expressed openness to the bill.
“It stops the state from writing a check that amounts to double dipping,” Harris said in an interview. “I’m studying it.”
Follow Tyler Bridges on Twitter, @TegBridges. For more coverage of government and politics, follow our Politics Blog at http://blogs.theadvocate.com/politicsblog/.