At an estimated $745 million or so right now, the count for revenues raised by the 2015 Legislature might even go up. That’s because of the uncertainty of legislation that reduced tax exemptions and credits as a way of staving off a complete budgetary collapse.
One of the problems with getting a firmer number: The credits or exemptions are filed by businesses, either in tax returns or applications for the credits from the state.
That means that business lawyers and tax advisers are going to be busy with the work product of Legislature 2015.
Was it worth it? For most members of the House and Senate, the alternatives were worse. Even the best-case scenarios of Gov. Bobby Jindal’s last budget proposal would have meant deep cuts to colleges and trade schools, hospitals and health care providers. That’s on top of years of cuts in Jindal’s earlier budgets.
We agree that was a bad budget proposal and that lawmakers were right to seek alternatives. Still, many don’t like going to the voters with the taint of having “raised taxes,” even if the bulk of new revenues comes from reducing tax breaks, not really additional new taxes.
“The Legislature and the governor produced a state budget during the recent session that boosted government spending with higher taxes, lower tax credits and various forms of temporary patchwork financing,” the Public Affairs Research Council concluded.
If that judgment is going to be held against the legislators seeking re-election this fall, it must be put into context. PAR’s wide-ranging analysis of the good and bad in the Legislature provides some useful starting points for a real discussion.
Why starting points? Because we as voters not only need to assess the performance of incumbent members and the proposals of those seeking open seats this fall. We also should be looking ahead because we’re going to have to do something like this all over again with a new Legislature next year.
Major candidates for governor have promised a special session early in 2016 to deal with the underlying fiscal problems of the state. But it’s important for context to understand that these problems didn’t start with Jindal’s budget proposal back in the spring.
Another good point: It’s not as if government has grown that much with this year’s revenue increases.
Why not? Because the several new taxes and the trimming of exemptions and credits only filled part of the hole. Legislative leaders were faced with a $1.6 billion shortfall, and that’s a huge proportion of the general fund that does not include things like federal funds and other restricted spending.
That is true enough, but the underlying problem is that cuts in popular programs — cuts that the elected members were reluctant to make this year — will be necessary to reduce significantly the built-in costs of government.
Bottom line, in the words of PAR: “The next governor and Legislature will face another large funding gap when they seek to balance the fiscal 2017 budget. The economy is improving and therefore state receipts for income and sales taxes are expected to increase and help alleviate the pressure, but only marginally.”
The temporary fixes of 2015, in other words, are very temporary.