21 May 2007

Committee action, May 21: HB 262, HB 228, HB 575 and others

Today was conjecture day for spending surplus money, waiting on the Revenue Estimating Conference’s results tomorrow. In the House Appropriations Committee, several bills were reviewed outlining how money would be spent.

HB 722 by Rep. Roy Quezaire would create a new fund to roll sales taxes into that would be distributed according to the proportion of the fund paid in by a parish’s taxes; that is, the more a parish put in, the more that would come back to it for its road needs. This would be newly dedicated money on top of existing funds for roads in the state, although only some of the money, 31 percent, would be distributed that way. This money thus would be removed from the general fund.

Rep. Don Cazayoux complained the present system was preferable because it spread the money around. “This is a stark deviation … why decide to do it differently?” Quezaire said the new fund would better address immediate infrastructure needs, while projects of lesser priority would still be taken care of through the present system; nobody would be shortchanged because this would be a new pot of money.

Rep. Elcie Guillory wondered about the bill’s impact on ports. Quezaire said the 7 percent allocated to ports would be in addition to present current funding, essentially doubling the current allocation. The state supposedly gets $6 back for every buck spent on ports. Chairman John Alario advised the committee to move on to other matters, and so it did.

HB 168 by Rep. Bodi White would take 100 percent sales tax from vehicle sales to fund non-federal roads. He indicated there would be amendments which are that it would be phased in over a couple of years, not starting this budget year, and it would have a sunset provision to reassess whether it was needed after 2010.

Rep. Tom McVea asked about its impact concerning HB 722. White said there was no dedicated funding to things like ports, it also used the existing funding structure instead of creating a new class of prioritized road. Other members made approving noises concerning it.

HB 165 by Rep. Joel Robideaux also wanted the 4 percent sales tax. His bill would create a special fund to allocate by parish proportion of payment by its citizens. These funds would apply to all kinds of roads, including federally-matches. Treasurer John Kennedy indicated there would be no sunset provision because that would make it virtually impossible to use their shares to bond the money. Both the state and local governments would jointly decide what roads to utilize the money for. It would not deviate from the current priority project list because the parishes could recommend only those projects on the list.

Cazayoux pointed out that in essence it did deviate from the list because the list was statewide, but those projects that were unfunded from this new fund that were higher priority that those where funds were available from other parishes in essence would be jumped. Population, instead of being one factor of many, now became the overwhelming factor, he noted, which he thought unwise. Kennedy admitted it did this, but said the priority program was not doing the job and this would help. Cazayoux said it was a matter of money, not problems inherent to the program. Kennedy said dedicating the money would get more money to the actual building itself.

HB 691 by Rep. Pete Schneider would be to take 25 percent of the sales tax and distribute to the parishes for high-need roads.

HB 362 by Taylor Townsend would make any tax cuts or credits introduced into the budget apply to the state’s pending cap, meaning that tax cuts or credits could only come with a two-thirds vote. Rep. Steve Scalise pointed out that the reason for the cap and spending limit was to limit the growth of state government, which was not the same thing as giving money back to the people which helps growth of the private sector. Townsend argued that it would lead to better decision-making dealing with the budget. But then Townsend moved to voluntarily defer the bill, which happened without objection.

Scalise’s HB 228 would reaffirm by law that in computation of the expenditure limit figure would occur using actual, extant numbers rather than old data. Scalise noted past practice of using numbers already superseded by more current data was contrary to the intent of the Constitution, and the formula was not being faithfully followed by putting a formula into law which had yet to be done. Scalise said he believed there would be a court challenge if this bill was not passed, and quoted the Constitution to show how the formula now being used by the state contravened it.

HB 575 would force the state to send absentee voting material to everybody in the state. Reps. Juan LaFonta said the bill was going to be amended to do it just for residents of parishes affected by a declared disaster, at somewhat less cost, regardless of whether they had lived in the state since that disaster.

SB 29 would repeal income taxes over a four-year period. Author and Senate Revenue and Fiscal Affairs Committee member Sen. Max Malone said other states did this and were doing fine economically. He said eventually $3 billion would be taken out of the budget annually. Sen. Robert Adley objected to it, saying this was too big oh a hit and would not be responsible. Sen. Ann Duplessis said other states without income taxes should be studied to find out how they can do it successfully. Malone said he knew property taxes were lower in Louisiana but otherwise things often were the same in terms of tax burdens.

Adley moved to defer the bill but Malone asked for a substitute motion to pass, which took precedence. Malone was the only senator on the committee to vote for his bill.

This bill would reduce reliance on H & R Alario for tax services
We haven’t done a fiscal note on the Alario firm
Rep. Blade Morrish to Alario talking about his HB 87 and making reference to Alario’s real job.

The compromise was made in the hallway about 20 minutes ago
You could have us saved that information
Rep. Warren Triche to Rep. Gordon Dove concerning HB 642

If you could provide us with $733 million in cuts, that would help us out … you will have that list of cuts for us, won’t you?
If you will co-author it
No, but I’ll look at it
Alario to Scalise and his rejoinder, as HB 228 in this fiscal year in effect would reduce the executive budget by that much.

TUESDAY: HB 113 and HB 614 are scheduled to be heard by the House Administration of Criminal Justice Committee; HB 598 is scheduled to be heard by the House Education Committee; HB 528 is scheduled to be heard by the House Insurance Committee.

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