The SAVE bill, which is an educational tax credit, does nothing for citizens who might file for the deduction on their income taxes, he says.
“The one and only purpose was for (Gov.) Bobby Jindal to go here in a few weeks and go on TV and say that he did not raise taxes, which in fact he did,” Reynolds said. “It sets a really bad policy precedent because in future years, future governors can use this to raise taxes to however much they want to.”
He explained the Student Assessment for a Valuable Education bill, or SAVE, is a higher education tax credit that is revenue neutral – no money changes hands.
“They came up with this idea that we’re going to give each student a $1,600 tax credit,” he said. “But we’re not going to give it to them. We’re going to give it to the Board of Regents. So, the parents never get any tax rebate on anything. The Board of Regents is a tax exempt organization, and they never get any money either, because the money that they were going to get anyway was already in the budget from our funding bill.
“It was a fictitious thing on paper that didn’t really hurt anybody, but it didn’t help anybody either,” he continued. “It just set a bad policy precedent. It was a smoke and mirrors game where by which Jindal could say we had tax credits…that were never there really.”
No one ever answered the question if parents would have to file the tax credit on their income taxes either, he said.
The House and the Senate agreed to pass the state’s $25 billion budget, plugging a $900 million deficit. The House voted 59-43, of which Reynolds was among those who voted against the budget, and the Senate voted in favor by a vote of 30 to 9.
“I just couldn’t make myself vote for smoke and mirrors,” he said. “I just had to draw a line somewhere and say it’s a matter of principle.”
Reynolds made it clear while higher education and healthcare was funded at last year’s amounts, the budget was cut across the board, and it will hurt several departments, cutting many jobs.
They did raise the cigarette tax and cut back on some of the rebates that have been given for many years, he says.
Reynolds alluded to the fact that a special session could be called in January to begin repairing the budget’s structure. The structure of the budget is where the problem lies, he says.
“We’ve got to change the structure of the budget,” he said. “The structure of the budget is fixed so that your hands are tied, you cannot move money and you cannot prioritize things. Capital outlay is a mess; the whole structure of the budget has got to be changed going forward if we’re ever going to get out of this mess that we’re in.”
If they don’t, he says, the budget is going to have a shortfall of $1.8 billion again. They used “one-time money” again to plug the holes in the budget, and that has to change as well, he says.