Saturday, August 13, 2016

Fiscal Cliff

I know much of South Louisiana is underwater right now. But the next disaster is already looming.
Louisiana is barreling toward a projected $1.5 billion budget shortfall in 2018, when several new taxes that were approved this year are set to expire.

A Joint Legislative Budget Committee meeting Friday morning gave state lawmakers the first official update on the size of the gap they could face when the 2018-2019 budget cycle rolls around.

Barry Dussé, director of the governor's Office of Planning and Budget, told the Joint Legislative Budget Committee that the current year's budget, which began July 1, is on track to remain balanced, as is the following year. The big test for the state, he said, comes in the budget that begins July 1, 2018.
This is all, sort of, by design. Both sides of the contentious budget debate this year decided to sunset the revenue measures passed in order to deal with the emergency. And since the reactionaries in the House made certain those measures were almost exclusively regressive sales taxes, it's just as well that the argument be restarted sooner than  later. Next year's fight over what we hope will be more progressive tax reforms could determine the success or failure of John Bel Edwards' underwhelming to this point administration. Expect to see him start building his case next month.
Edwards has called on the state Legislature to dedicate its session that begins next April to overhauling the state budget and tax structure, which means the state may never make it to that $1.5 billion "cliff," if legislators heed Edwards' urging and address it next year.

A task force that was established to come up with recommendations for lawmakers has been meeting regularly and is due to report back with its suggestions next month.
Of course now we'll need to account for billions more in infrastructure repairs after this flood. Maybe they'll find a few pennies floating around the governor’s mansion.

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