State Senate President John Alario complained of an upset stomach last week.
The virus going around was not the flu but talk that legislators could find some way to roll the remaining deficit into the next fiscal year.
That’s what Puerto Rico did, Alario said, referring to the $70 billion debt crippling the U.S. territory, which has a population and economy similar to Louisiana’s.
Louisiana law, however, requires a balanced budget. But over the past eight years, a lot of sharp practices have led to a graying of the black letters of the state constitution — meaning that despite all the assurances that rolling over the deficit until next year isn’t legally possible, it is realistically plausible.
“To even put that on the table gives me a stomachache. Tell you the truth, I was getting ready to go throw up,” Alario told House Appropriations Committee Chair Cameron Henry last week when the idea was broached.
Henry, a Metairie Republican, agreed that the idea is foolish fiscal policy but said he wanted representatives and senators aware of all the options regardless of how seedy they might seem.
While legislators are on the road to closing up much of the $900 million or so gap between what the state owes and the money it has to pay those obligations with before June 30 — many of the bills have passed both chambers and some have gone to the governor — even the most optimistic counting puts the remaining shortfall at $147 million.
House Republicans are as unwilling to sponsor more spending cuts that could shut down vital state services as they are to back increased taxes, leaving few options.
Armed with Tums, John Carpenter, who heads the Legislative Fiscal Office, pointed out: “I do not believe that the Constitution allows you to knowingly roll over a deficit.”
What actually is contemplated in the constitutional procedure, Carpenter said, is that lawmakers in good faith, using numbers they believe are accurate and correct, have to balance the budget prior to the July 1 start of the next fiscal year. Then, if the revenues don’t come in as anticipated by October or so, a deficit is declared, and the budget is rectified midyear.
Almost every year Gov. Bobby Jindal was in charge, the Legislature — which includes most of the members now serving — would arrive in Baton Rouge facing massive revenue shortfalls. The governor and his legislative majority came up with a crazy quilt of accounting gimmicks and short-term fixes to balance the budget without raising taxes.
They scraped up dollars from lawsuit settlements, sales of state properties, collections of a portion of what tax scofflaws had owed for years, etc. Plenty of the legislators would grumble, though not loudly enough for Jindal to care, about how the budget was balanced with a wink and a nod. Sure enough, come October the revenues expected didn’t materialize, and the budget had to be rebalanced.
That happened in each of the past eight years.
But it allowed Jindal to push the narrative for national pundits that he was able to painlessly slash government spending without hurting services. Nationally syndicated scribe Cal Thomas, for instance, touted the Republican governor for the national stage : “Gov. Jindal also confronted wasteful spending, which Washington politicians often talk about, but do little to reverse.”
This year’s Legislature is looking at bills that cut spending, raise taxes and rearrange money that won’t be available for next fiscal year, which starts July 1 and already is $2 billion short. Legislators are still short $147 million for the current fiscal year, which ends June 30.
One problem is that Democratic Gov. John Bel Edwards already has used up most of his legal authority to hack away at spending for this year. He needs the Legislature to handle most of the heavy lifting at this point.
“The only remedy available,” said Commissioner of Administration Jay Dardenne, is for legislators to “come up with a new revenue source.”
If legislators leave on Wednesday — the end of the special session — without covering the $900 million deficit, another special session would be necessary. Meanwhile, state agencies would have to begin putting their employee furlough plans and program shutdowns in motion — these things can’t happen at the drop of a dime.
“The reality is the House Appropriations committee is a committee that includes a lot of members who want to see cuts, cuts, cuts,” Dardenne said.
Mark Ballard is editor of The Advocate Capitol news bureau. His email address is email@example.com and is on Twitter, @MarkBallardCNB. For more coverage of government and politics, follow our Politics Blog at http://blogs.theadvocate.com/politicsblog/.