Louisiana revenue secretary tries debunking state spending myths

While opponents of Gov. John Bel Edwards continue to argue state spending increased under the democratic administration, Revenue Secretary Kimberly Robinson told members of the Rotary Club of Baton Rouge today that state general fund spending today is actually $1 billion less than it was a decade ago.

Robinson, in a lunchtime speech, presented a state budget primer to the generally business-friendly audience, explaining that in the current fiscal year, FY 2018, the general fund—that part of the state budget generated by taxes, fees, and royalties and over which the Legislature has discretion—is $9.4 billion.

By comparison, the general fund in FY 2008 was $10.4 billion. Critics of the governor’s budget counter general fund spending is higher today than in fiscal years 2010-2016.

“So the general fund is $1 billion below where it was a decade ago,” she said. “And that doesn’t even include transportation funding and the $13 billion backlog in infrastructure projects.”

Robinson’s “fiscal cliff notes,” as she called them, come as state lawmakers wrap up a generally unproductive regular session that failed to address a revenue shortfall of nearly $650 million that becomes effective July 1, when a host of temporary tax measures passed in 2015 and 2016 expire. Edwards called a special session that begins May 22 to address the shortfall.

Robinson tried to explain that state spending has not increased under Edwards, as is often asserted. Granted, the overall state budget, which is nearly $33 billion, has grown considerably over the past decade. But the bulk of that growth came from federal funds, primarily for healthcare and programs like Medicaid.

Of the $9.4 billion the state does have discretion to spend, about 51% of it is tied up or committed to specific dedications that include K-12 education, debt service, election expenses, and revenue sharing with local governments, among others.

‘When you pay these things up front, you only have a little over 50% of your budget left to spend,” she says.

Though lawmakers passed a budget during the final days of the regular session, it is $1 billion short to fund services at their current level, which Robinson said is unacceptable.

The governor issued more than 30 items in his call for the special session, giving lawmakers wide latitude to consider a variety of revenue raising options. Given the current anti-tax climate around the state and the fact that Republican lawmakers control both chambers of the Legislature, no one can say yet whether consensus is developing around any particular solutions on the table.

“The only thing people have agreed with me on in two years is expanding sales taxes to services like Turkish baths and massage parlors,” Robinson quipped, eliciting hearty laughs from her audience. “I don’t know who owns Turkish baths, but I know they don’t have lobbyists.”

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