Instead of embracing the Louisiana House’s $25 billion budget plan, the Senate Finance Committee set the stage for a legislative battle by making dramatic changes Wednesday.
One-time, or nonrecurring, dollars for ongoing expenses crept back into the state operating budget. Spending cuts were erased. More than $300 million was added for vouchers, public hospitals deals, laid off state workers, legal judgments, services for the disabled and other expenses.
“We have done the best we can to restore as many things as we could,” said the committee’s chairman, state Sen. Jack Donahue, R-Mandeville.
Much of the committee’s changes mark a dramatic reversal of the House’s approach. After the committee acted, House members huddled in groups on the House floor, plotting the next move in what could become an epic budget struggle between the two chambers.
House Bill 1, the main budget legislation, now goes to the Senate floor, which will debate the proposal Saturday.
“It sounds like there’s still some work to be done,” said state Rep. Joel Robideaux, R-Lafayette.
All the maneuvering takes place as legislators near adjournment on June 6.
Budget debate began earlier this year when Gov. Bobby Jindal unveiled his state operating budget for the fiscal year that starts July 1. The governor balanced spending for the state’s public colleges and universities with legal settlements, property sales and other one-time dollars.
Many in the House balked at the approach. Republicans and Democrats met and produced a different plan. The alternative approach cut spending, modified tax breaks and proposed an amnesty program to encourage taxpayers to settle tax disputes with the state.
Members of the Senate Finance Committee were critical of the House’s approach from the start, likening parts of it to controversial pay-day loans and questioning whether all the one-time dollars for ongoing expenses really were purged.
The committee faced other problems.
TOPS, or the Taylor Opportunity Program for Students, needed additional dollars to provide college tuition assistance to thousands of students.
The state Supreme Court ruled that it is unconstitutional to use dollars from the same fund that finances public school students for others to attend private and parochial schools. The ruling meant coming up with roughly $45 million to provide for students in the upcoming school year.
Three contracts for the privatization of LSU hospitals are expected to consume 94 percent of the dollars the governor set aside in the state budget for all eight planned deals.
During the public’s day to talk to legislators about the proposed budget, tears were shed over the years-long waiting list to receive state-provided services at home for disabled family members, including terminally ill children.
The Finance Committee found dollars for all those needs by grabbing one-time money that the House rejected and by using extra state revenue that recently materialized.
The committee also directed additional money to higher education, including the LSU Agricultural Center. State workers who lose their jobs with private sector takeovers of public hospitals would split $21.7 million in termination pay. Arts programs would get $1 million.
“We put something together that works with the House along the lines of what they sent us,” Donahue said.
The Senate committee did not reject all of the House plan.
Legislators left in dollars that would be generated by launching a tax amnesty program and by modifying tax breaks.
However, earlier in the day, a different Senate committee rejected a piece of the plan that the Finance Committee embraced, blowing a $17 million hole in the budget.
The Senate Committee on Revenue and Fiscal Affairs rejected House Bill 653 after business owners voiced opposition.
HB653 would set a cap on the amount of state sales taxes that businesses can keep in exchange for collecting the revenue.
Business leaders said tallying the sales taxes takes time and makes them liable for any mistakes in their calculations.
“We take a lot of time and a lot of pride in doing this correctly,” said Tommy Rouse, an owner of Rouse’s supermarkets.
Rouse estimated his supermarkets collected $8 million in sales taxes for the state last year and kept $80,000 for what is known as vendors’ compensation.
One member of the committee, state Sen. Robert Adley, said he was in the oil and gas industry for years and never got any compensation for collecting severance taxes.
“When we go in business, we know that’s part of what we do,” said Adley, R-Benton.
Other committee members were more favorable to the business owners’ opposition even though Robideaux, the bill’s sponsor, stressed that the proposal was fluid.
Robideaux offered to defer to the Senate’s discretion on the cap level. “There’s no perfect and magic number out there,” he said.
State Sen. Yvonne Dorsey-Colomb, D-Baton Rouge and a committee member, pressed her button and expressed sympathy for Rouse’s pain.
“I shop at your stores, and I just want to tell you I love your produce,” she said.
Instead of changing the proposal, the committee rejected it with three members voting for it and four members voting against it.
Other parts of the House budget plan cleared the committee.
The Senate Committee on Revenue and Fiscal Affairs advanced House Bill 456, the amnesty program, and House Bill 571, putting limits on the enterprise zone and quality jobs programs that benefit businesses.