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Hanna: Tax wiggle for the ages

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SAM HANNAThe Louisiana Senate began deliberations May 25 on the $24-billion state budget.

The spending plan for the 2015-2016 fiscal year sailed out of the House of Representatives late last week amid little fanfare. The new fiscal year begins July 1.

Lawmakers have until 6 p.m. on June 11 to get things right, or return for a special session in the worst of years to have one — an election year.

In the mix to help neutralize a $1.6-billion revenue shortfall are some $600-plus million in new taxes courtesy of the House of Representatives, which is fitting since all revenue measures must originate in the House. At least that’s what the state Constitution tells us. For now anyway.

Included among the tax increases are a modest spike in the cigarette tax and 10 other measures that tinker with various tax breaks for the business community. The giveaways for the motion picture and solar industries are impacted, too, though far too lightly. Those folks should remind you of career bureaucrats, meaning you can never fill them up.

Though the House signed off on the tax hikes as if members were handing out Christmas presents, the state budget arrived in the Senate some $155 million shy of being balanced. That’s pocket change, especially with Senate President John Alario piloting the ship. If anyone can find a couple of hundred million dollars to shore up the budget, Alario can — with his eyes closed.

Still, the budget must be balanced thanks to that pesky provision in the state Constitution. To you fans of big government, that means the state can’t follow the federal government’s lead and engage in deficit spending, or just borrow money from the Chinese to make ends meet. Instead, in Louisiana we are expected to pay as we go, or at least give the impression we’re paying our bills in a timely fashion. After all, what the people don’t know won’t necessarily hurt them.

All along throughout this fiscal-only session of the Legislature as well as in the weeks leading up to the session, we were led to believe Gov. Bobby Jindal would never sign off on a budget that was balanced by any net increases in taxes. Apparently Jindal got his cue from Grover Norquist, better known as “the” anti-tax crusader in America. Norquist, by the way, operates an outfit called Americans for Tax Reform. It’s based in Washington, D.C., which, by my count, is a long way from the Capitol in Baton Rouge.
That’s neither here nor there, though.

Besides, there’s been a change in plans, or a change in how this year’s budget is expected to spare higher education from deep cuts in state funding while keeping Norquist and his ilk happy.

That change surfaced Monday when Tim Barfield, secretary at the state Department of Revenue, said, in so many words, that the net increase in taxes wiggle would be figured over a five-year period. “It’s OK to have some things front-loaded,” Barfield said.

Which is just peachy since every tax hike the House passed, except the cigarette tax, expires in no less than 18 months after they’re initially levied. In other words, the Legislature can pass these new taxes and Jindal can go along with them and two important goals will have been achieved: The “fiscal crisis” is abated and Jindal gets a passing grade in the eyes of Norquist.

But, my fellow Louisianians, the “fiscal crisis” is going nowhere. It’s simply going into hibernation for a spell so lawmakers can run for re-election and Jindal can run for president.

So, in other words, there was no fiscal crisis. It’s a political crisis.

It always is.


Sam Hanna is a state political writer.