BATON ROUGE — Louisiana lawmakers completed their special session on taxes Thursday after raising $263 million more for the state’s operating budget, lessening — but not completely closing — gaps in health and education programs.
The House and Senate fell far short of the revenue goal set by Gov. John Bel Edwards to raise $600 million more for the $26 billion budget that starts July 1. But on top of taxes boosted earlier this year, they had raised about $1.5 billion to shrink holes in the spending plan.
While he didn’t reach his target, Edwards said he was pleased with the work of lawmakers who at one point were faced with a budget shortfall nearing $2 billion in the upcoming year.
“We have been able, to a very large degree, to stabilize our budget and avoid catastrophic cuts,” the governor said. But he added: “It is still not a pretty document.”
Weary legislators were ready to head home after 19 weeks of contentious work grappling with financial woes across three legislative sessions. The sessions were marked by heightened tensions between the House and Senate and, according to lawmakers, were the longest consecutive tenure of legislative work in state history.
Senate President John Alario gave up Thursday morning on trying to raise another $88 million, saying the House wouldn’t go along with the plans to reduce personal income tax deductions for people who itemize on their state forms.
“It’s apparent the votes are not there,” said Alario, R-Westwego.
The House rejected the measure earlier in the week. The Democratic governor and Alario tried unsuccessfully to revive it, against opposition from House Speaker Taylor Barras and other Republican House leaders.
Barras, R-New Iberia, said he thinks lawmakers did enough to supplement the state budget amid what economists have described as a Louisiana-based recession.
“I consider it a success,” he said. “I think the major concerns and the major holes that we had in higher education and health care are covered.”
The largest tax measures passed in this latest special session will boost the taxes charged on health care organizations known as HMOs and lessen inventory tax breaks for businesses. Lawmakers also crafted a multibillion-dollar construction budget and removed sales taxes unintentionally charged in the earlier special session on items such as school athletic event tickets, firefighting equipment and prosthetic devices.
But it took until the session’s final hours to hammer out a plan for divvying up the money the House and Senate raised. The House gave final passage to the bill only a half hour before the midnight deadline.
The budget deal struck gives the safety-net hospitals that care for the poor the full amount sought by the Edwards administration, though the hospital operators say that’s not enough to fully cover services.
Lawmakers agreed to cover only 70 percent of tuition costs for students in the TOPS college program, meaning students will have to pay more for school. It’s the first time since its creation that TOPS has taken a cut. In a deal pushed by House leaders, the money is front-loaded to cover the full cost of tuition for the fall semester, while levying a 42 percent cut in the spring. Edwards opposed the arrangement but wouldn’t say if he would line-item veto it.
College campuses were shielded from other slashing. But reductions will fall across most state agencies. K-12 public schools will take a hit, receiving $24 million less than they got this year. A newly-built juvenile prison facility won’t open, and the corrections department will take an $18 million cut.
Louisiana’s voucher program will get fewer dollars, along with state parks.
Meanwhile, lawmakers did nothing to respond to estimates that Louisiana may end the current budget year this month with up to a $200 million deficit.
Barras said he wants to wait until the books are officially closed to see what the real deficit might be, after accounting for prior tax changes and a delay in tax payments in parishes with flood damage.
“I just find it difficult to plan for a projection we’re uncertain will develop,” he said. “I’m just confident it will be something less than $200 million.”
Rep. Sam Jones, an Edwards ally, was disappointed lawmakers didn’t make more long-term, structural tax changes to end constant cycles of budget problems.
“We haven’t fixed anything because everything is just plugging the budget again, just like the last eight years,” said Jones, D-Franklin.