The Louisiana House coalesced Thursday behind a rewritten, bipartisan budget compromise that dumps many financing plans sought by Gov. Bobby Jindal in favor of cuts to tax breaks and dollars expected from a tax amnesty program.
BATON ROUGE, La. (AP) - The Louisiana House coalesced Thursday behind a rewritten, bipartisan budget compromise that dumps many financing plans sought by Gov. Bobby Jindal in favor of cuts to tax breaks and dollars expected from a tax amnesty program.
House Speaker Chuck Kleckley, R-Lake Charles, said he was confident the plan could win passage when lawmakers debate the package of bills Friday. Jindal, however, opposes pieces of the proposal that he considers a tax hike.
Lawmakers would strip $500 million in uncertain funding proposed by Jindal for the 2013-14 fiscal year that would tie ongoing operating expenses to items that haven't yet happened, such as property sales, and that would only exist for one year.
In its place, lawmakers are considering $63 million in reductions to tax break programs and $133 million in cuts to state agencies, changes that they say could last multiple years and provide more stability to the annual budgeting process.
To make the figures work, however, the plan would make its own assumptions. It includes $90 million in improved revenue estimates that haven't yet been projected - and millions of dollars in anticipated taxes collected through an amnesty program for delinquent payers, including $200 million next year.
Kleckley and leaders of the Republican delegation, the Democratic caucus and the black caucus stood together on the steps of the state Capitol to promote the deal Thursday.
They praised the bipartisan work and cited the compromise as a "game changer" for legislative independence in a state where the budget passed by lawmakers usually resembles what was submitted by the governor.
"There have been some bumps in the road, but because of the importance of this issue, because of the importance of the citizens of Louisiana, we have managed to bridge that gap and solve some of the challenges," Kleckley said.
An earlier compromise proposal ran into opposition from House Republicans because of concerns about the types of tax break changes included and the implications on certain industries. Jindal and business groups derided the proposal as a hefty tax hike on companies.
"I feel a whole lot better than I did two days ago," Rep. Jeff Thompson, R-Bossier City, said of the modified proposal.
The new version would use ideas once proposed by Jindal in his now-shelved tax swap plan, including cuts to film tax credits and to the Enterprise Zone business tax break.
"This is a very balanced (plan), it's a very modest step forward," said Rep. John Bel Edwards, D-Amite, chairman of the House Democratic Caucus.
Some of the ideas still face opposition from Jindal, who said he would veto any bills that would generate new state revenue without cutting taxes elsewhere. He considers the removal or limits on tax break programs a tax increase.
Rep. Tim Burns, R-Mandeville, described the proposal on his blog, saying it would "help prevent further cuts to higher education and health care by closing corporate tax loopholes."
The proposal includes:
-Caps on the salaries of out-of-state workers and out-of-state infrastructure that could be used to calculate the value of a film tax credit for a production.
-Changes to the Enterprise Zone program that would no longer allow credits to big-box retailers that aren't in the targeted disadvantaged zone and that would require eligible companies to provide full-time jobs and hire a larger number of area workers.
-Limits on solar tax credits, to apply to only one installation per residence.
-Caps on a program that pays vendors a percentage of the sales taxes they collect and remit to the state, to eliminate retailers with sales of $1.2 million more.
-Changes to the severance tax break for inactive wells.
Rep. Joel Robideaux, R-Lafayette, chairman of the House tax committee, said he hasn't heard much pushback from business groups about the revised plan.
"There's been some concern out there by the groups that are being affected, but at the end of the day, I think most of the business groups realize it could be much worse," he said. "None of the changes we're proposing have a detrimental effect to normal operations."
The reworked plan would include a three-year amnesty period for delinquent taxpayers, to give them the ability to pay their overdue taxes with lessened penalties as a way to generate upfront cash for the budget.
The move could shrink tax collections down the road, however.