It has been well documented that Louisiana is facing down a budget crisis, and that spending reductions and new revenue will be necessary to avoid deep, painful cuts to the state budget.
But the head of a state business lobbying organization said that immediate threat obscures the real issue: Unless reforms and structural changes are made, the state will find itself against that "fiscal cliff" again and again.
"We all got to the edge of this cliff together," said Stephen Waguespack, president and CEO of the Louisiana Association of Business and Industry. "It's not one party's fault. It's not one legislature's fault or stakeholder's fault. It didn't happen overnight. Unless we make some real changes — and those things are hard — no matter what happens July 1, that cliff is right around the corner again."
Waguespack was in Alexandria Thursday speaking to members of the Central Louisiana Regional Chamber of Commerce. He detailed LABI's position on the state budget and its legislative priorities this year.
Legislators can't pass tax changes during the regular session that starts in March, so a special session will almost certainly be necessary to address the projected billion-dollar budget deficit that will hit state government when some temporary taxes expire July 1.
Waguespack pointed to four things as drivers of Louisiana's "broken" budget — a tax system weighted too heavily toward sales taxes, where rates are high because of so many exemptions; Louisiana's economy growing at a slow rate; increased spending by state government; and statutory dedications that take away flexibility when spending cuts have to be made.
To really fix Louisiana's budget problems, he said, it will take growing the economy; reforming the tax code so more of the base is shifted into property taxes, which would give local governments more control, rather than everything flowing through the state government; addressing government spending; and eliminating many of the protections that force legislators and governors to target areas such as health care and higher education when making cuts.
In addition to unlocking many statutory dedications, LABI's priorities this year include placing a firm cap on state government spending and getting louisianacheckbook.comoff the ground. The proposed site is patterned on one in Ohio that tracks all government spending, from the state to the smallest locality.
"This is the revenue we have to spend; this is the government we can have with it," Waguespack said. "We have to curtail spending in this state. Other states in the South are doing things better, and we have to learn from them."