On behalf of CABL we would like to thank you for your service to our state. We know that these have been difficult times over the last several years as you have tried to enact budget and fiscal policies to move Louisiana in a positive direction. We appreciate your efforts.
Unfortunately, it appears we will be unable to enact the long-term fiscal reforms Louisiana truly needs in this special session. We can, however, take one initial step by putting in place some of the structural budget policies before you and ending the bad policy of temporary taxes. In just the short time they have been in place they have created uncertainty for businesses, harmed our economic development efforts, caused concerns for college students and families, and threatened increases in the amount of interest we pay on state debt.
From CABL’s perspective there are two pieces of the puzzle we need to address, one short-term and the other more forward-looking. The first and foremost right now is to bring stability and sustainability to the budget. At the very least during this session, we believe that you must determine the level of spending that you believe is appropriate for our state and authorize the revenues that will support that going forward.
That is perhaps the most basic responsibility of the Legislature. It is not asking you to do a difficult thing or an unusual thing. It is asking you to do what should be the most basic and normal thing. The fact that this has not been the situation in Louisiana for most of the last decade makes the timing all the more urgent.
As you know, CABL served on the Task Force on Structural Changes in Budget and Tax Policy. Our work over the course of more than six months yielded 28 recommendations dealing with both budget and tax policy. A number of the proposals before you are consistent with the recommendations we offered, yet it is important to note that we made our proposals in the context of a more holistic approach to improve our overall tax structure, not to fill budget gaps in isolation.
We make no pretense that the items before you to consider represent true fiscal reform. There are elements of substantive reform within them and they could set the stage for long-term action, but they are not the comprehensive reforms we need to make Louisiana more competitive.
So far, however, it has proven impossible to address the urgent need to stabilize our budget while at the same time making the structural changes that will position us for the future.
Given that, we urge to take the necessary steps to deal with the first part of that equation: 1) determine the level of state spending that you feel is appropriate to support the services that you believe the state should provide, 2) fund that level of spending in a balanced way without resorting to the gimmicks or sleight of hand we have seen in the past, and 3) do so in a way that is “permanent” to the extent that we end the practice of temporary taxes which represent flawed policy that only tends to exacerbate our problems.
From CABL’s perspective we still would like to see the Legislature address budget and tax reform in a thoughtful and meaningful way for the long-term. Yet, clearly, little of that can be done during this special session.
What can be done is to provide stability to our budget and end the distractions that for too long have prevented us from focusing on the many other important issues that impact our state. It is only a first step, but we urge you to take that step in this special session.