BATON ROUGE – Disagreements have persisted since December on the timing – and even the necessity – of a special session, but a noted political analyst believes Gov. John Bel Edwards aced it in both areas.
The decision to address the impending fiscal cliff prior to the regular session which begins March 12 could give legislators a head start on how to tackle the $994 million gap in the budget when the temporary one-cent sales tax expires June 30, said Barry Erwin, who heads the Coalition for a Better Louisiana.
The special session which begins Feb. 19 could avert a disaster, he told the Press Club of Louisiana at its weekly luncheon Feb. 12 at the Belle of Baton Rouge.
“If we don’t “fix” the problem to some degree in February, then we will at least have a budget on the table that makes a billion dollars in cuts that they’re not going to pass, and it’s just going to put negative, negative attention on our state to show that we can’t get our act together and our government is dysfunctional,” Erwin said. “And then we’re going to have to come back with a really short, very hard deadline at the end of the session in June to deal with the fiscal issue – and if we fail at that, we’d face a state government shutdown.”
In terms of issues, not much has changed, Erwin said.
The automatic tax changes from the federal level will make a difference in the budget, while Republicans will bring other issues to the table.
But just as the state’s problems did not begin overnight, lawmakers should not expect a quick solution to the fiscal woes. The move away from sales tax – a move endorsed by Gov. Edwards – would be a good start, Erwin said.
Louisiana ranks low on income tax burden and a bad business tax climate combine to create a disconnect for the state.
He believes a lower sales tax, along with changes in the income tax and elimination deductions on the income tax side would allow for lower rates both on the individual and corporate taxes.