Last Modified: Tuesday, May 07, 2013 6:06 PM
BATON ROUGE — Gov. Bobby Jindal continued his all-out attack here Tuesday on a House budget reform plan, calling it a tax increase that jeopardizes a $21 billion Sasol project planned for Southwest Louisiana.
Promises have been made to the company, he said, “and we don’t want to go back to being known as the state that doesn’t keep its promises.”
Republican conservatives and Democrats who came up with the $527 million proposal think the Jindal administration is being overly dramatic about effects of the plan that they unveiled late Monday.
The coalition produced a state general fund chart showing higher education in the state has been cut 80 percent since 2008. Colleges and universities received $1.4 billion in fiscal 2007-08, and $284.5 million in the governor’s proposed budget for the fiscal year starting July 1.
Republican conservatives blame Jindal’s constant use of one-time money and contingency funding in his budgets for annual mid-year and year-end cuts to state agencies. The House Appropriations Committee last week removed $490 million of that money, and that is what the coalition plan would restore.
The House is scheduled to take up House Bill 1, the state spending plan, Thursday.
Jindal, as he did a day earlier, brought some two dozen individuals together for a news conference to express their concerns about how the House coalition wants to plug that budget hole.
Reductions would take place in three areas. Cuts to department budgets would produce $106 million, other anticipated reductions total $27 million and changes in a number of tax break areas would bring in $329 million.
The coalition is also counting on $20 million from refinancing of the state’s tobacco settlement and $45 million in excess revenues expected to be announced by the Revenue Estimating Conference.
Jindal was quick to call the plan a “threat on the horizon,” and a $1.3 billion tax increase over the next four years.
Rep. Brett Geymann, R-Moss Bluff, one of the leaders of the coalition, said work continues on the plan with more fine-tuning scheduled for Tuesday evening. The goal is to make it more acceptable, he said.
Speaker of the House Chuck Kleckley, R-Lake Charles, came out in support of the plan last week. He told members of the Chamber Southwest Louisiana at a noon luncheon near the Capitol Tuesday the coalition proposal will solve budget problems for the next four years.
Jindal spoke later, and disagreed.
“The threat is right here upon us. Make your voices heard,” he told the chamber group.
The main bone of contention in the coalition plan is a 15 percent reduction in most of the state’s annual tax exemptions that would produce $329 million. Geymann said any attempt to remove some groups from the 15 percent cut would create a snowball effect.
Recipients would still receive 85 percent of those exemptions. Some of the affected areas involve movie-making, investment tax credits, enterprise zones, the Quality Jobs program, historic building restoration, wind and solar energy systems, digital media and software, milk producers and sugar cane transportation.
The 15 percent adjustments would produce $144.9 million, and corporate changes would raise another $157 million.
Dan Borne with the Louisiana Chemical Association was among the two dozen at the Jindal news conference.
“I am not here to pick a fight with the House,” Borne said. “This is not a good idea; it’s a terrible idea.” He said it placed the business community and manufacturing in the bullseye.
“It sends shockwaves into every corporate boardroom around the world,” Borne said. He called on the House to “revisit the plan and ditch it.”
Posted By: sb On: 5/8/2013
Sounds like Lake Charles can forget about any economic boom from Sasol if the House budget plan gets approved