- Associated Press - Wednesday, December 14, 2016

Recent editorials from Louisiana newspapers:

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Dec. 11

The Advocate on new tax proposals:

If you’re stuck in traffic, just about anything that will help is going to be popular, even new fees or a higher gasoline tax. Is it politically possible?

The hard-pressed state Department of Transportation and Development faces a long list of needed repairs for overloaded highways, old bridges, and the infrastructure across the state.

That list alone comes to $13 billion in needs that have been deferred again and again. But it doesn’t include the larger list, $16 billion or so, of the really big projects, like completing Interstate 49 from New Orleans to Lafayette, or building a new Mississippi River bridge in the Baton Rouge area, or replacing the old Interstate 10 bridge across the Calcasieu River.

Not to be forgotten are ports and railways and airports, all areas where DOTD has responsibility, and where there are also unmet needs.

Everything costs money, and a gas tax that has not been raised in a generation can’t keep up.

A panel appointed by Gov. John Bel Edwards said that the first list needs the application of another $700 million per year, and raising the state gasoline tax is the “most reliable” way to do so.

That it is, although the committee’s report includes other ways to generate money for projects, such as fee increases on commercial trucks to help pay for bridge repairs.

“That is what we are asking,” said Shawn Wilson, DOTD secretary and co-chair of the panel. “That is what we need to fix what we need to fix, and achieve what we need to achieve.”

A final vote on the overall plan will come next week, but the needs - the congestion that costs people time, the rough roads that add to motorists’ repair bills, and so on - are really the manifest part of this discussion.

What isn’t is clear as where the tax money for the problems will be found, and some legislators have questioned the increase, perhaps 20 cents per gallon, needed for the list. However, rising costs and a year-by-year inflationary cut in the gas tax’s proceeds make it almost inevitable that some gas tax increase be passed.

Yet just as there are crippling traffic jams on our roads, there is also a bit of a legislative congestion ahead.

Louisiana’s budget crumbled under Gov. Bobby Jindal’s strategy of cutting taxes and tapping one-time money to pay for recurring state needs. This reckless “don’t pay the bills” deal included indirectly tapping the highway fund for money for State Police, just one of the bad budget strategies that Edwards’ administration has struggled to end.

The state is getting by with temporary tax increases, including cuts in business exemptions and credits, that are nobody’s idea of really good tax policy. A new one-cent sales tax, used to bridge, partially, the Jindal hole also will expire in 2018.

That means in the new year that Edwards and legislators have to take a whack at both the transportation troubles and the overall budget backlog. Waiting isn’t much of an option, keeping the tax structure we have would be a mistake, and roads don’t get built by themselves.

A significantly higher level of leadership is needed from legislators, many of whom are the same folks who blundered along in Jindal’s path for eight years, failing to pay the bills. But above them must be a traffic cop for the variety of fiscal emergencies the state faces, and that will have to be the governor.

It will tax his scheduling capacity as much as any rush-hour logjam in our cities.

Online:

https://www.theadvocate.com

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Dec. 9

The Courier on the Louisiana shrimp industry:

We know several things about the Louisiana shrimp industry.

First, we know that our hard-working shrimpers have been caught between various natural and man-made forces that have taken their toll on the industry.

They have fought hurricanes and oil spills, as well as foreign competition - much of it illegal - and uncertainties in pricing and costs.

Second, we know that our shrimpers catch and sell some of the highest-quality, delicious shrimp in the world and that consumers who know the difference are willing to pay for it.

Those facts are borne out by a recent report by the Coalition to Restore Coastal Louisiana, which released “Louisiana Shrimp Value Chain: Price Dynamics, Challenges and Opportunities” earlier this week.

The report seeks to define some of the challenges that confront our shrimpers but also to identify opportunities where they can take advantage of the blessings they enjoy.

Together, the report paints a realistic picture of an industry that is suffering but that has the ability to return once again from the brink to provide a lucrative living to those who are willing to embrace it.

“We hope that our report recommendations will help Louisiana’s shrimp industry prepare for the future,” Corey Miller, the coalition’s outreach and engagement director, said in a news release. “We hope that shrimpers will use these recommendations to strengthen their businesses to help them better cope with future challenges.”

Among those recommendations are the following:

- Sell more shrimp directly to consumers and retail outlets.

Online:

https://www.houmatoday.com

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Dec. 11

The Times-Picayune on fixing the state’s budget:

Louisiana’s budget deficit just keeps growing. In October, the number was said to be at least $313 million. The “at least” implied that the gap could be larger, but no one knew how much. Now we know. Gov. John Bel Edwards’ administration on Monday (Dec. 5) put the mid-year budget shortfall at more than $600 million.

The $313 million is the deficit leftover from the previous budget year, which must be dealt with because Louisiana law requires a balanced budget. The additional $300 million is the current shortfall in tax collections. On top of that, the state took out a $300 million short-term loan this fall to help cash flow. That has to be repaid.

The deficit is so steep now that Gov. Edwards might have to call the Legislature into special session to deal with it. “We were hoping that we would not be talking about another special session,” Commissioner of Administration Jay Dardenne said. “The magnitude of the cuts may be too much.”

In two special sessions this year, legislators approved more than $1.5 billion in new taxes to try to balance the budget. They also made cuts. But neither effort stabilized the budget.

State analysts warned legislators last summer that corporate taxes were well short of the amount they were counting on. Gov. Edwards asked for an additional $320 million taxes in anticipation of a projected deficit, but the House refused. Most lawmakers didn’t want to believe the tax predictions, and some even accused analysts of lowballing revenue estimates on purpose. They look foolish now.

Greg Albrecht, the Legislature’s economic analyst, said the downturn in corporate taxes is steeper than expected and is continuing. The economy is weak, particularly in the oil and gas industry, which is likely leading to lower collections, he said.

Job losses are causing a dip in personal income tax collections, he said. “Exacerbating the picture has been the fact that much of the employment losses have been in relatively high wage sectors such as oil and gas mining and support, manufacturing, professional and technical services and all three government levels (local, state and federal),” he said in a recent report.

All of this has Louisiana in financial bind.

“I know many people thought we would have more money than we needed right now,” Ben Nevers, the governor’s chief of staff, said during a budget meeting Tuesday (Dec. 6). “That just hasn’t happened.”

Legislators still don’t want to raise taxes again, and that is understandable. But $600 million in cuts aren’t going to be easy to make.

Mr. Dardenne said the governor would propose mid-year cuts to higher education, hospitals that treat uninsured people and services for people with disabilities. The Legislature worked hard to avoid cuts to those services during the budget process this year, and rightly so. In November, when the state was looking for ways to resolve the $313 million deficit, lawmakers rejected $18 million in cuts to higher education. They didn’t want to add to the pain caused by deep cuts to the TOPS scholarship program this year. But the administration hasn’t found an alternative, Mr. Dardenne said.

The state’s rainy day fund may be tapped to reduce the deficit, but that won’t come close to balancing the budget. Because of constitutional and other restrictions, lawmakers also are limited in where they can make cuts.

In addition, $1 billion of the tax increases lawmakers approved this year are temporary and will evaporate in 2018 if they aren’t extended.

All of this should finally force the Legislature to make some badly needed structural changes to fiscal policy. A task force released its recommendations in October for how to stabilize the state’s finances.

The report recommends reducing or eliminating the federal income tax deduction on state tax returns, eliminating many exemptions and credits and lowering rates. The task force also suggested: putting sunset provisions on all business tax incentives and eliminating those that aren’t productive, lowering sales taxes, restructuring or phasing out the corporate franchise tax and looking for ways to consolidate, reduce or eliminate contracts, among others.

The task force emphasized that the report’s recommendations should be considered “in their entirety as a whole and not individually in isolation” to establish a balanced and fair tax system. Taken together, these sorts of changes could stabilize revenues, curb overspending and make Louisiana more competitive economically.

Lawmakers have rejected many of the proposals before. But with the budget deficit growing, they may be forced to do something. Louisianans are counting on it.

Online:

https://www.nola.com

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