A key component of Gov. John Bel Edwards’ effort to raise taxes during the special session was on life support Wednesday after the Democratic chairman of the tax committee cast the decisive vote to reject the measure.
The vote by state Rep. Neil Abramson, D-New Orleans, came after hours of impassioned testimony for the measure by university presidents and parents of disabled children before Abramson’s Ways and Means Committee. House Bill 11 failed 10-9, with Abramson casting the final vote.
The measure would raise $116 million of the $600 million that Edwards says is needed to prevent devastating cuts to the Taylor Opportunity Program for Students scholarships, safety net hospitals, prisons, K-12 schools and the state’s colleges and universities.
HB11 would limit an income tax break that mostly benefits people who earn at least $100,000 per year.
In an interview afterward, Abramson said he voted against the measure because he couldn’t be sure whether HB11 would raise taxes on low- and middle-income taxpayers because the version before the committee had been amended.
“The measure was not the governor’s proposal,” Abramson said, a statement that technically was correct. “It had nothing to do with the governor’s tax plan.”
The Democratic governor didn’t see it that way because Wednesday’s vote dealt a sharp setback to his goal to raise the $600 million during the special session that began Monday night and that will last up to 18 days.
Edwards supported the bill, and he left no doubt afterward about how he viewed the no vote by Abramson and nine Republicans on the committee.
“Given the $600 million deficit, when you vote against additional revenue, you are voting to cut TOPS, higher education, K-12 education and life-saving health care services, including our safety net hospitals,” Edwards said in a statement. “That’s the choice some legislators are making, and that’s the choice they will have to defend to their constituents.”
Earlier, immediately after the vote, supporters and opponents of the measure poured into the hallway outside the committee room and could be heard analyzing the high drama of what had happened.
Edwards administration officials, not willing to give up, began discussing a last-ditch option to try to have the full House force HB11 out of the committee. That would take at least 53 votes in the 105-member House.
Tax measures approved by the Ways and Means Committee on Tuesday — and up for a vote on the House floor Thursday — would raise $211 million, leaving the governor $389 million short. The committee will hear several more tax bills Thursday.
HB11 would close one-third of the $389 million.
The measure 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. Under the proposal by state Rep. Rob Shadoin, R-Ruston, taxpayers would be allowed to take 57.5 percent of the deduction, instead of 100 percent today.
Edwards has said the 57.5 percent rate was high enough to continue to allow taxpayers to deduct their charitable contributions and mortgage interest payments. Popular deductions they could no longer deduct likely would be gambling losses, health expenses and unreimbursed business expenses.
The Ways and Means Committee initially discussed HB11 on Tuesday, but the committee chose to bottle it up, with Republicans showing little appetite for the measure. The committee also bottled up two other measures that would have raised income taxes primarily on the wealthy. The Republicans said their constituents were telling them they pay enough in taxes.
After Tuesday’s hearing, the governor met with two committee members who seemed open to supporting the various income tax measures as part of a broader plan to eliminate individual income tax breaks in exchange for lowering the tax rate. Those two legislators were state Rep. Barry Ivey, R-Central, and Rep. Julie Stokes, R-Kenner, who was sponsoring three bills in the broader package.
Edwards met with a larger group of committee members Wednesday morning in his office and said in a brief interview afterward that he wanted the Ways and Means Committee to give the full House the chance to vote on HB11 and other individual income tax measures that the committee failed to advance on Tuesday.
On Tuesday, the committee spent only a short time on HB11 before shelving it.
To revive the bill on Wednesday, Edwards agreed with Stokes’ plan to amend HB11 by tying its fate to three measures sponsored by her that would give voters the chance to eliminate a popular tax break in exchange for a single flat rate. (This was the version Abramson referred to afterward. The committee separately approved all three measures; they do not raise more money.)
On Wednesday, supporters clamoring for more revenue turned out in force before the committee, including a dozen parents who rely on state assistance to have in-home help with children who suffer from debilitating illnesses.
“Now is your chance to vote pro-life once the children leave the womb,” said Ashley McReynold, with her 7-year-old son Cooper alongside her.
Others who spoke included the executive director of the Louisiana Sheriffs’ Association, the executive director of the Louisiana School Boards Association, the presidents of LSU and the University of New Orleans, three members of the Board of Regents and the presidents of the college and university systems.
“We need this revenue, as does education and health care,” Michael Ranatza, the sheriffs’ association executive director, told the committee. The sheriffs are short $15 million in state money to operate their prisons.
Rep. Phillip DeVillier, R-Eunice, made the motion to defeat HB11.
“My district and our people are struggling,” he told the committee. “I can’t ask them for more money.”
Dawn Starns, the state director of the National Federation of Independent Business, testified against the bill and said in a statement afterward, “We applaud Ways and Means members for their tough vote against reducing the excess itemized deduction absent real tax reform.”
Abramson’s vote against the measure shouldn’t have been a complete surprise. He voted against a similar measure during the first special session.
Voting AGAINST HB11 (10) : Chairman Abramson; and Reps. DeVillier; Ivey; Paula Davis, R-Baton Rouge; Dodie Horton, R-Haughton; Stephanie Hilferty, R-New Orleans; Jay Morris, R-Monroe; Jim Morris, R-Oil City; Tom Willmott, R-Kenner; and Mike Huval, R-Breaux Bridge.
Voting FOR HB11 (9): Reps. Stokes; Chris Broadwater, R-Hammond; Stephen Dwight, R-Lake Charles; Ted James, D-Baton Rouge; Major Thibaut, D-New Roads; Joseph Bouie, D-New Orleans; Marcus Hunter, D-Monroe; Jimmy Harris, D-New Orleans; and Robert Johnson, D-Marksville.
Follow Tyler Bridges on Twitter, @TegBridges.
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