“At long last.” “Finally.” “Proves what we have known.” These are words Gov. John Bel Edwards used to describe House Speaker Taylor Barras’ about-face Wednesday morning, the third day of the 2019 legislative session, when Barras agreed to recognizing increased state revenue forecasts for the current fiscal year and next.
Barras has been the lone holdout among the quartet of Revenue Estimating Conference members, who are required by law to act with unanimity when altering the official forecasts. On four prior occasions, the House Speaker (in one instance, his proxy, Appropriations chairman Cameron Henry) said no to acknowledging the higher state income projections, insisting he felt there was “too much uncertainty”, and “it’s hard to put on paper how the taxpayer will react.” Conservative words, but coming from a banker by trade? It’s been rickety reasoning, conspicuously feeble on facts or figures in defense of the position – beyond an obviously partisan ploy in this, an election year.
Barras’ statement of concession was as frail as his rationale for his recalcitrance had been. “I have been accused of ignoring the economists’ views. I am hesitant to guestimate the numbers, yet it seem this is as close as we’re going to be able to get. Therefore, I am prepared today to adopt somerevenue, but only if we adopt the lowest amount.”
Perhaps much of the reason for Barras’ capitulation is a result of public discussion during the Senate Finance Committee meeting on Tuesday.
As is traditional, members of the committee were given an overview of the budget proposals as they are being vetted by the House Appropriations Committee. Also, as has become traditional throughout this term, there are two primary budget bills filed – but in a break from long-standing tradition, neither of them is designated “House Bill 1.”
“House Appropriations is working with HB 105, the bill jointly authored by their chairman, Cameron Henry, and House Speaker Taylor Barras,” Senate Fiscal Director Sherry Phillips-Hymel explained to the Senate Finance Committee Tuesday. “There is also HB 103, by Speaker Pro-Temp Walt Leger. Walt’s bill contains everything from the governor’s budget proposal. Chairman Henry’s HB 105 has $134-million less than the governor’s proposal. That’s the difference between the officially recognized and unrecognized forecasts. The biggest differences, application-wise, are that Chairman Henry’s bill cuts $20-million from LDH (the Louisiana Department of Health), and $13-million from DCFS (the Department of Children and Family Services.)”
“We prefer to take that $13-million cut to SNAP,” DCFS Secretary Marketa Garner Walters told the Appropriations Committee on Tuesday, referring to the federal program formerly and more familiarly known as “food stamps.”
“If we do this, and remove these dollars from your budget authorization for SNAP, what does that mean in the event of a disaster – say, a hurricane or a flood, for example?” Speaker Pro-Temp Walt Leger inquired.
“I would have to come back to the legislature – to the Joint Budget Committee – for authorization to implement the disaster SNAP program,” Secretary Walters answered.
“Isn’t this the majority of your department’s cost for SNAP?” Leger pressed. “Don’t you split the administration costs 50/50 with the federal government?”
“Yes, but they pay 100% of the benefits that go to our citizens,” Walters replied. “That’s about $100-million per month.”
“Per month?” Leger asked.
“Yes, sir,” the Secretary responded. “And you all should realize that if we cannot stand up disaster SNAP immediately, then we cannot provide any shelters, or any emergency disaster housing. It’s all tied together. We can’t shelter people if we can’t feed them, and we can’t provide those emergency feedings without being part of the federal SNAP program. And if we can’t do disaster SNAP without delays, the federal government will not allow us to be part of the SNAP program at all.”
On the opposite side of the Capitol building, members of the Senate Finance Committee voiced confusion over the ramifications of the House Speaker holding up the adoption of an updated forecast.
“I don’t understand why there are no line items for the statutory dedications or self-generated fees within this budget!” Sen. Sharon Hewitt (R-Slidell) exclaimed. “I don’t understand how we’re saying there are $18-million in ‘unfunded mandates’ for a budget year that’s not even begun!”
Sen. Jim Fannin (R-Jonesboro) who preceded Cameron Henry as House Appropriations chairman, also wanted to know why statutory dedications, fees, and self-generated revenue weren’t in the budget proposal.
“Aren’t we forecasting stat-deds and fees?” Fannin asked the Legislative Fiscal Office’s chief economist Greg Albrecht.
“We are, but we are only doing two years at a time, because of Act 419,” Albrecht replied.
Act 419 started out as HB 437 of the 2013 legislative session. Authored by Rep. Lance Harris (R-Alexandria), it requires estimates for dedicated funding streams be presented to the REC for approvals, but only for the current year and the next, with “Appropriations from the funds to be limited to the prior fiscal year’s fund balance.” The amounts of these funds available are recognized by the REC after adoption of an updated forecast. Remember, if the quartet of REC members doesn’t unanimously agree on each item in order, they can’t move on.
Without agreement on the current year forecast, they could not move on to the next year’s forecast, or to the projections for the statutory dedications, or for the fees and self-generated revenue. They couldn’t discuss or recognize the prior year’s surplus, or make the required projections another three years into the future.
“But fees and self-generated revenues are the taxpayers’ money. Statutory dedications are the taxpayers’ money, and it has increased! We’re spending $2.1-billion more overall of taxpayer money than we did ten years ago!” Sen. Conrad Appel (R-Metairie) complained.
“That’s the budget – the spending side – not the revenue forecast,” Albrecht replied.
The amount officially added today to the revenue forecast for the budget year that begins July 1 (also known as the FY 20 forecast and FY 20 budget), is $119-million. The current fiscal year, which ends June 30, was bumped up by $110-million. And the REC also recognized the surplus from FY 2018, which ended last June 30th. That’s $308-million, but as a surplus (and therefore “non-recurring funds”), the uses to which that money can be put are constitutionally and statutorily restricted.
The projections for stat deds, and fees and self-generated revenues were also recognized, and altogether these numbers will alter the amounts allocated to the various state departments, agencies and programs.
Will some of it be used to save SNAP, for example?
In theory, Appropriations chairman Cameron Henry would use the revised numbers to file an updated budget, and designate it – as is traditional – HB 1. In practice, however, Henry has tightly held onto the contents of his intended amendments to the budget bill, revealing them to none but staff and his GOP sycophants on the committee, until time for the entire committee to vote on advancing the budget bill to the House floor.