Legislative Watch

ABOUT THE SPENDING CAP
The Governor’s calculations on the spending cap are designed to circumvent the constitutionally allowed amount. The calculations are determined by the Legislative Fiscal Office at $547M. The difference is $733,000M less than the Governor’s formula. The constitutional cap is intended to constrain government growth but the Governor’s budget may grow the spending by $1.3 billion and still not hit the spending cap for next year’s budget.

The problems?
No limits on spending
Republicans will have a much tougher time trying to block all the spending initiatives Governor
Blanco plans to push. HB1 (the budget) is due in the Senate next week. The limit has not been
adhered to in the past and no enforcement of the limit has been applied. To circumvent the cap,
the Governor is taking one-time spending targets and setting aside funds so that Federal
matching dollars can be collected. Those (one time) funds collected are then applied toward
recurring expense items. But what happens when the expense recurs and no funds have been
set aside to pay for the recurrences? To raise the spending cap limit to the governor’s desired
$1.3 billion amount, a 2/3 vote is required from both the House and Senate chambers.

Decreased State Income
There is a decline or deficit in the amount of money collected by the state with which we pay our
state expenses. There is a decrease in Sales taxes, gambling revenue, and personal incomes
that are taxed. Although revenue from oil somewhat balances out the decreases in income, oil
revenue should not be a factor in measuring income because oil can and will rise/reduce funds
with its market value.

Governor’s Initiatives
Jim Tucker quoted an infamous remark from Louisiana’s past while speaking to the Press Club on May 14, “Lord, give us a boom one more time and we promise not to overspend”.

Pay raises and supplemental benefits ($365M) for public employees (are any guidelines set?)
Charity healthcare delivery resurrected to pre-Katrina standards as opposed to restructuring the way healthcare is delivered and to guarantee healthcare is effective.
Repatriation without corroboration
Higher education without substantiation

Possible solutions?
1. Limit recurring expenses to the constitutional cap of $547 million and set aside another
$547 million for new (additional) recurring spending.
2. Give deductions or tax cuts to help the private sector ‘recover’ and provide some insurance
rebates to victims of the hurricane stricken area. The idea is the money from the rebates
and tax deductions will
help place the private sector funding in balance with the federal funding.
3. After tax cuts are given from the $547 million, spend the remainder but on one-time
expenditures only.

There may be a need to over ride the appropriations committee budget on items above the cap.
There may be a need to introduce and pass on the House Floor, a resolution on the budget that
regulates spending before the Appropriations committee begins developing their budget.

Jim Tucker commented on May 14 to the Press Club, “This year’s surplus can become tomorrow’s disaster”

Republican Initiatives

Reduction in the State debt
Restoration of coast
Roads and Transportation
Retirement
Recovery:
To target everyone for recovery rather than just targeting some individuals
Balance the amount of Federal funds and private sector funds directed toward recovery
Return some tax cuts to taxpayers and allow tax cuts to help drive some of the recovery efforts. Examples: Itemized deductions for home mortgages, charitable contributions, and insurance tax credits.
Deconstruct the $300M set aside for Thyssen-Krupp and allow legislation to direct funds to aid
individuals and commercial business efforts
Change the law to force the spending cap regulation and thereby constrain government growth.

The above information is compiled from presentations by Rep. Steve Scalise and Jim Tucker

LFRW RESOLUTION UPDATE
Senator Tom Schedler has introduced SB 99 that proposes a constitutional amendment that excluded owners 65 or older, or those owners' surviving spouses who are 55 or older or who have minor children, from the provision that prohibits them for the "special assessment level" because of income. This, of course, is our Resolution 2.

We would like as many Republicans as possible to get on board to support Senator Schedler in his efforts. Please consider speaking with your legislators about possibly signing a statement of support on this bill, especially if it passes and makes its way to the public vote required for a constitutional amendment.
Argiro Morgan, Resolution Director's report

RECOVERY MILESTONES
Yesterday, May 14 with the Insurance Rating Commission being voted out(decommissioned) by the House panel, the Office of Consumer Advocacy within the Louisiana Department of Insurance was established. Consumers now have more input in handling insurance claims that are paid out to them.

MUST WATCH
HB 532 Daniel (Pending House Floor action)
Provides for the position of ethics administrator to serve as chief administrator, to provide general office management and to perform other functions that the board may delegate. Prohibits the ethics administrator from engaging in certain activities.

REPUBLICAN WOMEN MAKE A DIFFERENCE
Some members of the Livingston Parish Republican Women traveled to the House Civil Law and Procedure Committee meeting May 15 in opposition to HCR-4 which sought to ratify the Equal Rights Amendment. Louisiana was one of the four states seeking to stand for ratification; the other states being Alabama and Florida who have defeated the attempt, and Arkansas who has yet to decide.

Karen Ellis, Julia Robinson and Carolyn Hatcher all sent “cards of opposition” to the panel while three women’s organizations spoke in favor of the Resolution. Yet another person spoke that HCR-4 was an effort to have abortions paid for by the government and without discrimination on the basis of sex for elective medical procedures. The 4-5 vote count failed to pass HCR-4:
Robert J. Carter (D) For Ernie Alexander (R) Against
Richard Gallot (D) For Shirley Bowler (R) Against
Jean-Paul Morrell (D) For Ronnie Johns (R) Against
Monica Walker (D) For Nicholas Lorusso (R) Against
Joel C. Robideaux (I) Against


Karen Ellis Reporting