State budget gap talk begins

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Legislators began discussion on how to stop the state from reaching the fiscal cliff Tuesday.

Rep. Gene Reynolds, D-Minden, said although talks have started, it’s too early yet to say if they’ve made any headway.

“We had several people in the meeting just looking at information,” he said. “It was an informational meeting, looking at some options and trying to get to some common ground between both parties.”

The discussions center on how to close the gap on an estimated $1.1 billion in expiring temporary sales taxes July 1, 2018.
Lawmakers are faced with how to produce stable revenue needed to pay the bills, much of it mandated by statute, such as $227 million in new Medicaid costs.

New pay scale structure and pay raises for state employees, prisoner housing and an increase in K-12 enrollment, round out more increased costs. Health care, insurance and retirement expenses are tied to nearly $100 million of the shortfall estimate.

“When that penny sales tax rolls off next year, that in itself is $100 million,” Reynolds said. “You’re looking at income tax reform, you’re looking at sales tax reform, corporate tax reform, or a rebalancing of it. It’s nothing that hasn’t been talked about. It’s just the fact that can we change a few things here and there and possibly get some of that passed and get some stability back. Basically, right now, we’re operating off of temporary taxes, and you can’t do business like that.”

He said once they “zero in” on some things, they would be able to release more about what was discussed.

The Associated Press contributed to this report.

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