Special Session On Sales Taxes Begins Today

The special session kicks off today, giving legislators two weeks to come to an agreement on how to handle a $648 million budget shortfall that threatens to potentially devastate healthcare and higher education. A special session in February failed, and legislative attempts to craft a budget with 648 million in cuts were vetoed, but Governor Edwards says this will be different.

The budget gap, known as the “fiscal cliff” is the result of sales taxes that are set to expire June 30th.

Democrats and many Republicans agree that at least some of the expiring revenue will need to be replaced, and reports say a consensus may be growing around renewing half of the one penny sales tax that falls off in July. Edwards says it’s a compromise he may have to settle for.

House Republican Caucus Chairman Lance Harris indicated that if Republicans do agree to renew any of the expiring taxes, it would most likely be some of that expiring penny.

“I’m not sure a half a cent, a third a cent, or a quarter of a cent, it just depends on what instruments are filed.”

Harris believes Republicans will not push a final budget that resembles a spending plan similar to the one that passed the House that eliminated public-private partnership hospitals and Medicaid programs that pay for nursing homes for the elderly. He says Department of Health funding is not at risk and chided the governor for sending eviction notice letters to patients whose housing was put at risk.

“That was a political stunt that just scared are most vulnerable people in our society, but I believe that we will be funding the Louisiana Department of Health sufficiently to cover that.”

Many Democrats, specifically the black caucus, began the legislative season firmly stating that they would not support attempts to keep a portion of the expiring penny sales tax, because it unfairly targets the working class. But Baton Rouge Representative Ted James indicated that the caucus may be open keeping some of that penny if it means fully funding healthcare and higher education.

“At this point, Democrats are looking forward. We are going to continue to keep the penny or a portion of the penny. We are going to make sure that our priorities are funded.”

James says he’s open to compromise plans, but will not support any budget that resembles those passed by the Louisiana House and Senate that either slashed healthcare or gutted higher education and TOPS.