AP NEWS

Louisiana income forecasting stalemate ends after 5 months

April 10, 2019
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Senate President John Alario, R-Westwego, left, speaks with House Speaker Taylor Barras, R-New Iberia, after a meeting of the state's Revenue Estimating Conference on Wednesday, April 10, 2019, in Baton Rouge, La. The conference broke through a logjam and adopted increased income forecasts that will give lawmakers more money to spend in the legislative session. (AP Photo/Melinda Deslatte)

BATON ROUGE, La. (AP) — Louisiana’s latest financial impasse between Democratic Gov. John Bel Edwards and House Republican leaders ended Wednesday, when the House speaker agreed to adopt a brightened income forecast that gives lawmakers more money to spend.

House Speaker Taylor Barras was the lone holdout on the state’s Revenue Estimating Conference to oppose boosting the projections. But he relented five months after GOP leaders started repeatedly blocking the improved forecasts.

The required unanimous vote from the conference gives lawmakers $110 million more in general state tax revenue to spend in the budget year that ends June 30 and $119 million more next year.

Barras said he felt more comfortable with economists’ predictions of the dollars that would arrive in the treasury after having the additional five months of data collection. He noted the increases adopted Wednesday were smaller than those recommended months ago.

“My issue from November ’til now has been let’s make sure we get that number as close as we possibly can,” the New Iberia Republican said.

Wednesday’s vote broke through a stalemate that threatened to derail the budget debate in a short, two-month legislative session that must wrap up June 6.

The increases are slightly less than the Edwards administration wanted. Barras agreed to take the lower of two estimates of what would arrive in general tax collections. Also, some House Republicans don’t want to spend the full amount in the projections.

“I think there will be long lists of requests to spend it all,” Barras said. “I would hope we don’t spend it all.”

But while the improved forecasts won’t terminate all the disagreements, the haggling will be over smaller numbers in a $30 billion-plus budget for the financial year that begins July 1. And any remaining bickering will center on where to enhance spending, ensuring that current services and programs are protected.

A pay raise for public school teachers and support staff already was included in both Edwards’ and House Republican leaders’ versions of next year’s budget.

Edwards, who is running for a second term on the October ballot against two Republican challengers, also wants additional spending increases for colleges, the child welfare agency and public safety programs.

The governor included extra money in his budget proposal to ensure the TOPS college tuition program covered all eligible students. The Republican budget proposal is estimated to be $12 million short. Lawmakers are expected to widely support the increase to keep TOPS students from facing cuts in assistance.

“This action by the (Revenue Estimating Conference) proves what we have known since the middle of last year — that for the first time in a decade, Louisiana has an improving economy and budget surpluses,” the governor said in a statement.

Economists who advise the conference were muted, however, in their assessment of Louisiana’s economic fortunes, describing low employment growth and income growth across the state.

“But it’s better than it’s been,” said chief legislative economist Greg Albrecht.

Before Wednesday, the last financial forecast for the upcoming year had been adopted in June. Those figures didn’t reflect the recommendations of nonpartisan state economists who expected tax collections to be higher, and they were missing billions that agencies expect to receive from fees, fines and other revenue sources.

Votes must be unanimous from the four-member Revenue Estimating Conference. Panel members are Commissioner of Administration Jay Dardenne, the governor’s chief budget adviser; LSU economist Jim Richardson; Senate President John Alario and Barras.

Across monthly meetings since November, Barras or his surrogate had refused to raise projections for general state tax collections, with Barras talking about economic uncertainty in Louisiana. The Edwards administration called the move political from House Republicans with whom he’s feuded since taking office in 2016.

“This was a useless exercise, except creating confusion during this interim period,” Dardenne said. “I’m very happy that we have a forecast and we can now proceed with an air of certainty.”

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Follow Melinda Deslatte on Twitter at http://twitter.com/melindadeslatte