Remarks by Gov. John Bel Edwards 1st Special Session of 2018 February 19, 2018 (As prepared for delivery)
Mr. President, Mr. Speaker, Members of the Legislature,
Honored Guests, My fellow Louisianans:
Before I begin, as you may have noticed as you have traveled to Baton Rouge, the Louisiana and United States flags are flying at half-staff to remember the 17 precious lives that were lost at Marjory Stoneman Douglas High School in Florida last week. This act of pure evil is a parent’s worst nightmare. Donna and I are praying for the families of the victims, the survivors who must deal with the aftermath of this senseless violence, and also for country. No child should ever have to fear for their life within the walls of their school. If you would, please join me in a moment of silence as we remember the 17 students and faculty members who lost their lives last week.
Good evening, everyone – and welcome back. This is now the fifth time I have called you into a special session. And if we all work together, I’m actually optimistic this could be the last.
Every step we have taken in preparation for this session is to ensure that we get the job done. And that we get it done right. And that we get it done now. I am optimistic that we can do it. My optimism is based on the feedback that I have received from many of you who share my concern about what will happen if we don’t address the fiscal cliff, but more importantly, share my belief that Louisiana’s brightest days are ahead if only we can come together to solve the problems that have plagued our state for years.
Last fall, I traveled the state and had over 30 meetings with business leaders and elected officials. The message was the same in Lake Charles as it was in Alexandria and everywhere else. Business leaders and local officials are tired of the endless financial battles. They want us to stabilize our budget once and for all, reform our tax code so that it is predictable and fair for all Louisiana citizens and businesses, and create a structure that grows with our economy so that we can get out of our own way.
The problems we face are not new. The fiscal cliff is the result of more than $1.3 billion in temporary revenue set to fall of the books June 30th. And yes, that revenue was supposed to serve as a bridge to long-term tax reform. That was the promise that we made to the people of Louisiana. Had we stuck to that plan, we wouldn’t be here today. Instead, in the 2017 fiscal session – the last ordinary fiscal session before the fiscal cliff – not a single bill – not one – to fix the cliff based on your own task force recommendations made it out of the Ways and Means Committee.
Although I am disappointed that it has taken this long to solve the problem, I hope you find motivation in how much better off Louisiana is now than we were the first time I called you here two years ago.
Back then, we had inherited a $1 billion shortfall that had to be addressed in just three months before the end of the fiscal year and a more than $2 billion shortfall for the next fiscal year. Today, I’m simply asking that we replace - not raise, but replace – a portion of the revenue that is scheduled to fall off the books. In fact, with more than $1.3 billion in revenue falling off the books, according to the House’ Fiscal Office estimates, I think we can summon the courage to replace $994 million to fully fund TOPS, stabilize support for higher education and adequately fund health care and other critical priorities.
We’ve already seen what’s possible when we budget honestly and responsibly. In fact, as some of my Republican friends in the legislature have said, our current budget is the most honest, responsible one they’ve seen in 10 years.
For the first time in nearly a decade, we’ve been able to stabilize funding for higher education. Working together, we fully funded TOPS. We saw midyear surpluses rather than deficits and destabilizing mid-year cuts. Just look at how this has changed the future for higher education:
• The UL System, our largest, has seen a dramatic increase in admission requests for next fall. UNO, for example, has seen a more than 20 percent increase in requests for admission.
• The LSU System has seen a 38 percent increase in admission requests for next fall. And for out of state students, it exceeds a 50 percent increase.
• Our community and technical college system is growing and looks to add 5,000 students next year.
People, that’s what success looks like.
We’ve come a long way since 2016. We addressed that shortfall by taking a balanced approach of revenue, strategic spending cuts, significant savings, and economic growth. Had we not made spending cuts, we would be talking about a cliff that is much larger than it is. Almost all of the revenue that was passed to eliminate that shortfall is going away on June 30th and it is nowhere near $2 billion. However, some want to argue that these weren’t real cuts. But just ask a student who did not receive his or her full TOPS award last school year because you chose to fully fund the program for only one semester. Ask our hospital partners who have seen cuts in state support for the last two years. Ask our higher education leaders, who, to my disappointment, saw less state general fund support in 2016. Those cuts that we made were real and they impacted people’s lives in a very negative way.
But the real question is not what we have done until now, it should be what are we going to do going forward. I know there are a few of you who believe I should not have called this special session. There are even a couple of you who believe there is no fiscal cliff. There are even those of you who acknowledge that there is a fiscal cliff, although you don’t want to fix it. You are entitled to your opinions, just like I am. But none of us are entitled to our own math. According to the Revenue Estimating Conference, the amount of the fiscal cliff is $994 million. That represents the current forecast difference of state general fund from this year to next year. For those of you who acknowledge that there is a cliff, and propose that the only solution is to make spending cuts, as I’ve told you before, I can respect that position. I disagree with it, but I can respect it. What is disrespectful to the people and families of this state is for you to take that position and then also insist that you are not the one that has to make the tough and painful choices; instead you want to put those decisions off on someone else. If you want to reduce government spending, propose the specific cuts and put your name on them. But let’s be honest about one thing when you say that government should spend less. What you really mean is that government should do less. Again, that’s a completely acceptable position and a debate that we should have in public. But it would mean reduced opportunities for Louisiana’s kids to go to college. It would mean reduced opportunities for health care for the neediest and most vulnerable among us. And it would mean reducing law enforcement’s ability to do its job, and it would mean inadequate funding for a host of other critical priorities.
As you might recall, last year, my friend Sen. Jack Donohue passed legislation that called for my administration to present a “standstill
budget.” Not a single member of the legislature voted against that proposal. Senator, thank you for putting that plan forward. Honestly, I was skeptical about how it would impact the services people rely on in this state, but I know you meant well by it. Well, today, my proposal, to replace a portion of this revenue that we are losing, would be considerably less than a standstill budget proposal.
So anyone who suggests that we are not living within our means, that spending is out of control, is simply ignoring the facts.
Time is of the essence. If we don’t address the challenges before us during this special session, we risk slowing the momentum that we have gained in Louisiana. Our economy is improving. Since January 2016, Louisiana has attracted 83 major economic development projects that represent over $25.6 billion in new capital investment for the state. These project wins are attracting almost 20,000 new direct and indirect jobs to Louisiana, while also retaining more than 13,000 existing jobs. We landed the second best economic development deal in the entire country last year with the announcement of DXC Technologies – the largest economic development deal in our state’s history – in large part because we stabilized funding for higher education. Unemployment has dropped to its lowest point in 10 years and more folks are out looking for and finding jobs than when we started this journey in 2016. And yes, there has also been wage growth. And I tell you, the growth of our civilian labor force, the measure of how many people are out looking for jobs, jumped from 50th in the country in 2016 to 25th in 2017. But while some people insist on painting a grim picture of our state’s future, this is the reality:
• Louisiana ranks No. 5 among the Top States for Doing Business, according to Area Development magazine.
• Louisiana ranks No. 4 in the country among Small Business-Friendly states, according to Thumbtack— which actually gave Louisiana an “A+” for its support of small businesses.
• And in keeping with our momentum, when it comes to transparency in state government spending, Louisiana ranks number 7 in the entire country. I welcome transparency. I don’t fear it. As a state representative, I voted 5 times to improve transparency in our governor’s office. As governor, we run the most transparent administration in our state’s history because of those bills that I supported.
These are big steps forward. It’s the kind of progress that people expect. It’s the kind of progress that you and I expect to continue. That can’t happen, however, if we allow ourselves to come anywhere near falling off the cliff.
The budget I presented before you last month was not my choice, it was my obligation. And while the constitution imposes on me that obligation to present a balanced budget, my moral obligation, not only to you but to the people of Louisiana, is to be honest about the situation we face.
We’ve been through this song and dance before. By now, the enormity of $1 billion in cuts should come as no surprise to any of you. Because the cuts can only take place from the $3.4 billion discretionary state general fund slice of the budget, we all know that by law there are only two main pots of money to cut from: higher education and health care. Precisely the two areas of government that people all across the state consistently tell me over and over again they don’t want to see cut.
And while the majority of you agree that we need to address this problem now rather than later, there are still some who believe we should push this off until June.
I want to reiterate what a disservice that would be to the people of this state who we’ve been elected to serve.
There are thousands of parents who lie awake at night waiting for us to act, so they can prepare to send their kids off to college next fall. There are students currently on TOPS and even more high school students who are about to start college who need to know what their tuition will be next fall and if they’ll have the support of TOPS. For many of those students, that’s the difference between staying in Louisiana or leaving.
One of those students is with us today.
Brenna Satterfeal is a freshman majoring in Special Education at Southeastern Louisiana University. Please join me in welcoming Brenna and her mom, Donna, to the Capitol.
Last month, Donna, sent me a message on Twitter that speaks for a lot of students and families across the state. She said that Brenna turned down full scholarships out of state to stay here in Louisiana, but she was only able to do that because of her TOPS scholarship.
I want every student in Louisiana to make the same choice Brenna made. They should never even have to second guess that decision. I ran for governor for a lot of reasons, but chief among them was this: if our young people decide they want to leave Louisiana for higher education or to pursue a job or have a rewarding career, we wish them well, and we hope they’ll return some day. But, if they feel that they have to leave, we have failed them. We cannot fail Brenna and the thousands of students like her who are begging us to act. In my mind, it doesn’t matter who gets the credit for funding TOPS and higher education. We just need to get it done.
If we wait to address the cliff, if we don’t make it abundantly clear that the scholarships we promised our students are protected, we’re going to start losing the incredible young people whose job it will soon be to carry this great state forward.
If we wait until June, our economy too will take a hit. The rating agencies that have downgraded our credit over the last several years will again consider whether we will ever have a stable budget. Businesses are going to have to move forward as if the worst case scenario is the only scenario. That means organizations that provide essential health care services for some of our most vulnerable populations will have to start laying people off. Our partner hospitals, with thousands of private sector employees, would be forced to issue layoff notices because of this uncertainty. Just a few moments ago, I spoke with Kelly Monroe, the executive director of the Arc of Louisiana, who is with us here today.
The Arc has long provided support and personal care assistance for people with developmental disabilities and their families. They are one of the providers for our waiver services, many of which face elimination should the cliff not be fixed. Kelly showed me some sobering figures about what the potential cuts to health care would mean for the dedicated providers who care for our constituents with disabilities and their families. 55 to 60 percent of the people they serve would lose their services, and approximately 2,000 employees would have to be laid off. That’s over half of the people they employ throughout the state. And this is just one organization in the state. There are many others that provide these services and have employees and they will be similarly affected. These organizations and the fellow Louisianans they serve cannot wait to know if they have to lay off their workers or, in some cases, close their doors.
We talk a lot about running government the way we would run a business. No prudent business person would choose to wait.
The can has been kicked down the road so far that the only place left for it to go is right off the cliff.
There are thousands of families also at risk of losing critical services that help them care for a loved one and keep them at home.
Mothers like Tina Haines, who is here with us today with her daughter Karina.
Karina, 10 years old, receives a Children’s Choice waiver. Tina is a full time working mom. She’s got enough on her plate to worry about. She shouldn’t have to spend the next four months worrying if they’re going to lose the services that help her care for Karina while also providing for her family.
I can’t imagine that there is anyone here who would be okay leaving Tina and these other families in limbo.
So, we find ourselves at a crossroads. Do we continue down the path to prosperity we are on or do we needlessly put ourselves right back where we started? Do we stick with the status quo, or do we map out a new and better future for Louisiana? I am imploring you – let’s turn this tide together. The breeze of hope that got us here today is still propelling us forward. But that breeze can only get us to the doorstep of change. We have to be the ones to open the door. We have to seize this opportunity.
I have told you that I am willing to be flexible. I stand by that. My number one goal is to put this problem behind us so we can get back to the business of making our state an even better place to live, work, retire, or pursue an education. But I need you to follow through with your end of the bargain and work with me.
My door has always been open. Over the last several months, I’ve met with many of you to discuss our options and outline my plan. That plan has been available to you and the public since early December. It calls for lowering the state’s sales tax and implementing many of the reforms that your task force recommended. In a nutshell, I’ve given you your plan.
Mr. Speaker, you have put forth your own plan and ideas to help solve this problem. I believe this is a good faith starting point, and I appreciate your willingness to work together on this issue. I recognize that these are tough decisions we are making, but our ability to compromise is essential. And by definition, compromise means you get some of what you want in exchange for accepting some of what you don’t want, and I know we are headed in the right direction. We know what needs to be done. Economist after economist, task force after task force, over several decades and during Democratic and Republican administrations, have recommended long-term solutions to our problems, and yet we continue to ignore their advice. These experts – our experts – have been telling us over and over again how to pull ourselves up and out of this mess. We can take the best practices we see in neighboring states and implement them here in Louisiana.
We have to be more concerned with Louisiana’s future than what score we might receive from a political organization masquerading as an trade association. As Albert Einstein said, “We cannot solve our problems with the same thinking we used when we created them.” We surely can’t afford to outsource our decision-making to the principle architects of the mess we are trying to clean up.
For the next 17 days, I am asking you not to think only as Democrats or Republicans, but as Louisianans. We all want the same things. There is only one “side” to be on here and that is on the side of the people of our great state who are tired of hearing about the same problems year after year with no resolution.
Every decision we make should be focused on how it’s going to impact our future. Louisiana is experiencing a surge of momentum right now that we haven’t seen in a long time.
All we have to do is work together and seize this opportunity to build a strong foundation for the future. In short, all we have to do is put Louisiana first.
I’m asking you to join me, and I know that together, we can get this done.
God bless you all, and God bless the great state of Louisiana.