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House backs $25 billion budget compromise

Last Modified: Friday, May 10, 2013 6:05 PM

By Jim Beam / American Press

BATON ROUGE — A coalition of House Republicans and Democrats succeeded in rewriting Gov. Bobby Jindal’s proposed $24.7 billion state budget here Friday, marking a rare independent streak by the legislative branch.

The final vote on House Bill 1 was 93-5. Southwest Louisiana representatives voted for the spending plan.

The reworked budget for the fiscal year beginning July 1 moves to the Senate where it has often been rewritten to the governor’s wishes. House members who were asked said they have hopes the Senate will make only minor changes, but they indicated they have received no signals about what might happen.

Rep. Brett Geymann, R-Moss Bluff, and a coalition leader, put one of the finishing touches on the efforts of the reformers. He  amended the fiscal 2013-14 budget to replace $525 million in one-time and uncertain money the governor had used to balance his proposed spending plan.

The coalition’s success marked a defeat for Rep. Jim Fannin, D-Jonesboro, chairman of the House Appropriations Committee. Fannin’s committee last week removed Jindal’s one-time money from the budget in order to move it along to the Senate without those funds. 

The House refused to go along with the plan, and voted to put the governor’s money back into the budget. Members wanted to shape the spending plan to their own liking, and they eventually accomplished that goal Friday.

The five bills the coalition needed to raise some of the replacement money easily exceeded the two-thirds vote (70) required for tax matters.

A measure that modifies the severance tax on inactive wells for three years in order to produce $20 million for the budget was approved 99-0.

House Bill 571 raises $10 million by modifying the Enterprise Zone tax credit that has expanded beyond its original intentions. It was approved 81-14. 

The coalition raised $23 million with HB 696. It makes changes to the movie tax credit and a wind or solar tax break. The vote was 86-11.

HB 653 reduces the compensation paid to vendors who collect the state sales tax. The change raises $10 million, and it was approved 81-17.

The coalition is counting on $200 million in new revenues from a tax amnesty program. HB 456 sets up the process, and it was approved 87-8.

A late amendment to HB 571 created lengthy debate. It curbs two incentives granted to prospective businesses — a corporate headquarters relocation rebate and a competitive project incentive payroll rebate.

The rebates would not be granted between July 1, 2013, and June 30, 2016.

Critics of the amendment called it a threat to the Sasol $21 billion expansion project planned for Southwest Louisiana. However, a change in the amendment excluded projects negotiated between Jan. 1, 2013, and June 30, 2013. It also added that the legislation wouldn’t apply to any agreements already entered into by the state Department of Economic Development.

Speaker of the House Chuck Kleckley, R-Lake Charles, went down to the microphone to tell his colleagues the Sasol project has already been “massaged,” and that he was comfortable with the amendment.

Kleckley added that the state has to draw the line when it comes to how much it can grant to businesses as incentives.

The amendment was approved 75-24. 

Nine House members from Southwest Louisiana, with one exception, voted for the five bills and the amendment to HB 571. Rep. Johnny Guinn, R-Jennings, voted against HB 571 and the controversial amendment.

Other funds are being used to replace the one-time and uncertain money sources budgeted by Jindal.

Department budget cuts will bring in $106 million, other reductions total $27 million, tobacco money refinancing will produce $20 million, Internet sales another $20 million and $90 million in additional revenues are expected to be announced by the Revenue Estimating Conference.

The budget contains $270 million in one-time money, and it will be used on one-time projects that don’t require annual funding. They include budget stabilization, debt payments, retirement debt, construction projects, coastal protection and highway construction.

The House earlier approved a number of budget reform bills sponsored by the coalition. One of the more important measures would require the budget to be adopted 16 days prior to the end of the session.

Budgets are routinely adopted on the last day of sessions, and legislators are reluctant to come back to a veto session. The change required in HB 436 would give lawmakers time to deal with gubernatorial vetoes before the session ends.

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