Louisiana lawmakers initial budget plan leaves Mississippi River bridge funding up in the air
GOP leaders haven’t settled on how much money will go toward Baton Rouge I-10 span
The House Appropriations Committee unanimously advanced an annual budget proposal to the full House that leaves $400 million in available funding unused. (Julie O'Donoghue/Louisiana Illuminator)
The Louisiana Legislature’s Republican leadership on Monday unveiled its tentative $44 billion budget plan outlining how it intends to spend the unprecedented amount of money available to the state, though a high-profile section of the proposal was left unfinished.
The House Appropriations Committee unanimously advanced an annual budget proposal to the full House that leaves $400 million in available funding unused, an unusual move that indicates a lack of consensus among lawmakers on how to use all of the money available to them.
Gov. John Bel Edwards recommended putting $500 million toward a new bridge in Baton Rouge over the Mississippi River, a proposal legislative leaders have repeatedly criticized. The House Appropriations Committee was expected to present an alternative plan for the money this week, but it hasn’t materialized yet.
The Appropriations Committee agreed to siphon $100 million from the $500 million Edwards wants for the bridge project to maintain existing roads. It put the remaining $400 million in a state fund to be used for an undesignated purpose. House leaders said they are still in negotiations with the Senate over what to do with the money, some of which may still go toward the new bridge.
Those who had also hoped Louisiana’s windfall of cash might result in tax cuts or even a one-time rebate to Louisiana residents will likely be disappointed. A House committee scuttled several proposals for tax breaks Monday, making it less likely a major tax cut will pass this session.
Legislative leaders have been focused on trying to keep the state budget plan under Louisiana’s spending cap. The state constitution limits government growth by restricting state spending in a budget cycle unless there is a vote of two-thirds of both chambers.
Given the amount of money on the table, legislators are in danger – for the first time since the spending cycles immediately after hurricanes Katrina and Rita – of hitting the cap and needing that extra vote to break it. It might not be possible to get enough support to raise the spending cap in the conservative House, so legislative leaders are trying to avoid the vote by taking creative approaches to the budget’s construction.
To avoid the cap, Republican leaders have tried to spread the state spending across multiple budget years and multiple state funds, thereby arguing all the money isn’t going out the door in a single budget cycle and the cap shouldn’t apply. There appears to be some consensus surrounding this strategy, with even the head of the House Conservative Caucus, Rep. Jack McFarland, R-Jonesboro, saying he’s supportive.
The Legislature could still run into problems with the spending cap though if a state panel raises the estimates for state revenue next month as expected. If lawmakers attempt to spend extra money made available to them at that time, they could have to employ even more maneuvers to avoid the spending cap vote again.
Legislators also said they are cognizant of limiting spending regardless of the issue of the cap. The state may be flush with cash now, but it’s anticipating a large shortfall in a little over two years.
In 2025, Louisiana’s sales tax rate is scheduled to drop 0.45%, which will cut state funding for K-12 schools, higher education, health care and higher education by hundreds of millions of dollars annually.
Last year, lawmakers also voted to divert $150 million in the upcoming budget cycle from health care and higher education to transportation projects and approximately $300 million annually in future years for the same purpose.
With this in mind, Republican leaders said they removed $25.7 million worth of supplemental pay increases for local law enforcement and first responders that Edwards had included in his budget proposal. It would have equated to an extra $100 per month for workers to those who qualified.
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“We need to be mindful of the shortfall that we will have to address,” said House Appropriations Committee Chairman Jerome Zeringue, R-Houma.
The proposal may also be targeted for political reasons. Groups pushing for the bump in pay, mainly local sheriffs and municipalities, are currently at odds with House Speaker Clay Schexnayder, R-Gonzales. They oppose his plan to try and centralize sales tax collections.
Law enforcement is likely to see their funding added back into the budget on the Senate side. Senate Finance Chairman Bodi White, who controls the budget process in the Senate, is moving a bill to add the $100 supplemental payment that the Senate approved unanimously earlier this month.
Here are other items included in the spending plan the House Appropriations Committee approved:
State unemployment trust fund replenishment: $500 million
The state’s unemployment trust fund was depleted at the start of the COVID-19 pandemic when an unprecedented number of people were out of work. Louisiana is still looking to get the trust fund back up to its pre-pandemic levels.
This is slightly less than the governor’s proposed allocation of $550 million. Edwards had said $550 million would be needed to avoid a trigger that requires the state to tax businesses at a higher rate if the trust fund falls below $750 million. The Legislature hopes to avoid that higher tax rate by extending a temporary suspension of the law that would impose it.
The House unanimously approved a resolution Tuesday with that extension. It heads next to the Senate.
Water and sewerage system improvements: $450 million
The state has between 1,600 and 1,700 boil water advisories across the state each year. While $450 million might seem like a large sum, it’s not nearly enough to address the state’s challenges with providing clean drinking water. The backlog of maintenance needs in Louisiana’s water and sewerage systems is estimated to be $7 billion. Edwards had proposed devoting more money, $500 million, to this cause.
Teacher and school support staff pay raises:$148 million
The House Appropriations Committee and Edwards agreed educators should see another pay increase this year. The funding would provide a $1,500 annual raise for teachers and $750 annual raise for school support staff. Teachers have received $3,300 in pay raises over the past four years, Zeringue said.
Lake Charles Interstate 10 bridge: $100 million
Dubbed by truckers one of “scariest” bridges in the country, the Interstate 10 bridge over the Calcasieu River in Lake Charles has no shoulder and is incredibly steep. It’s also very old. Transportation Secretary Shawn Wilson said it was built before the interstate system even existed.
This money would be combined with federal funding to upgrade the bridge. The total project is expected to cost more than $800 million.
Tangipahoa Parish 1980s flood victim relief: $75 million
The House Appropriations Committee has proposed making two lump sum payments to more than 100 residents and business owners in Tangipahoa Parish whose properties were destroyed in a 1983 flood. The damages total $300 million, though plaintiffs have been willing to settle with the state for less than half that amount.
An initial payment of $45 million would be made this year followed by another payment of $30 million next year. A few million dollars that had also been set aside for this settlement several years ago will be distributed.
Last year, Edwards and the Louisiana House agreed to start paying the residents, business owners and their survivors a portion of the money owed, but the Senate balked. At the time, Cortez said the Legislature shouldn’t set a precedent of paying large judgments against the state.
Hurricane Ida Recovery: $30 million
The House Appropriations Committee added $30 million worth of Hurricane Ida relief to the governor’s original budget proposal.
Workers who serve people with disabilities: $34 million
Edwards had put an additional $31 million toward raising the rates for organizations that provide services to people with disabilities. The extra money will increase pay from about $13 per hour to $18.50 per hour. The House Appropriations Committee has expanded this proposal to increase a wider range of programs, such as those that work with people with autism.
The Appropriations Committee also added 250 more slots for people with disabilities to receive government-funded services.
Higher education faculty pay raises: $31.7 million
The House Appropriations Committee and Edwards agreed to give higher education faculty another pay raise. They received a 2% to 3% salary increase last year. Prior to 2021, Louisiana faculty had not received a raise in 13 years.
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