Gov. Jindal At Odds With Democrats And “Fiscal Hawks” Over La. House’s Proposed Budget

Details emerge on what's contained in the Louisiana House's proposed budget for the fiscal year that starts July 1st.

A coalition of Democrats and Republican "Fiscal Hawks" propose reducing state tax credits by 15%, as a way to fund critical services. Democratic House Caucus Chairman John Bel Edwards, of Amite:

We have obligations that we have to fund as well. And so, we tried to come up with a more reasonable, more balanced approach so that we're not engaged in cutting all the time and setting the stage for mid-year cuts.

But Governor Jindal says that will result in a massive tax increase on businesses. Jindal said when the government takes more out of your pocket, that is raising taxes - anyway you size it up.

We need to grow the private sector economy, not the government.

Edwards, in turn, says they oppose Governor Jindal's proposed budget, for using one-time dollars and contingency funding to pay for higher education. "We thought a better way to do that was to allocate real dollars to higher education," says Edwards. "That's what this plan does."

But some lawmakers are not onboard with this House plan. Republican Kenner Rep. Julie Stokes says tampering with state tax incentives sends a bad message to businesses in the state, and those considering coming here:

How can you do effective tax planning, how can you effectively choose where you want to locate your company, or even choose where you want to keep your company, choose how you're going to hire and the various things that we have incentives built around if you don't know if those incentives are going to be reliable from year-to-year?

State Economic Development Secretary Stephen Moret says Louisiana's tax incentives have helped bring many new businesses to the state; resulting in tens of thousands of new jobs. He says he's "gravely concerned" about what the House intends "not only because of the shift in the direction but the fact that it would suggest to corporate America that our trajectory has changed. We're actually going to go back. We're going to take an already complicated tax system and make it even more uncertain."