'Run in Circles, Scream and Shout'
“When in danger or in doubt, run in circles, scream and shout.” The naval adage, quoted in Wouk’s 1951 “The Caine Mutiny” and again in Heinlein’s 1973 “Time Enough for Love”, pretty well describes the current status of both the state budget and legislative action.
Lawmakers, like Senate Finance chairman Jack Donahue, don’t like the governor’s proposal.
“It’s really not a budget. It’s a couple of ideas,” Donahue said in committee last week.
And legislators ran in circles last week, starting — then stopping — alternative plans. Part of the problem came when they found out repealing the business inventory tax wouldn’t bring in the half-billion dollars they expect, right away.
“You won’t start there,” legislative fiscal analyst Greg Albrecht told the Senate Revenue and Fiscal Affairs committee. “Only about 11 percent of that is attributable to returns in the first year you would be making the bill effective.”
An alternative plan — to do away with the tax entirely — would leave local governments without income they depend on. During discussion of that proposal, St. Charles Parish Assessor Tab Troxler told lawmakers they were running in circles.
“All we’re doing here is digging on the local side, taking that dirt and throwing it on the state side, but I don’t see any additional revenue,” Troxler stated.
Senator Robert Adley urged action anyway.
“We are in a short session,” Adley reminded Senate Finance committee members. “We need the House to start movin’ bills. We need to move a bill.”
They did move Adley’s bill, which promises the state will come up with funds from somewhere to help local governments make up the funding they’ll lose. The bill, SB 177, is a constitutional amendment, so even if it gets a two-thirds majority approval from both chambers, it still has to win voter approval in the fall.
Yes, more circles.
Danger and doubt deepened, along with the budget hole. $17-million received from the tobacco settlement was overpayment that has to be returned immediately. The federal Centers for Medicaid Services again ruled against the privatization deals for the Charity hospital system, objecting to advance lease payments. That’s approximately 200-million Medicaid dollars they will take back by withholding it from the federal transfer of funds to Louisiana. That may happen as soon as September of this year.
LSU’s credit outlook was downgraded by Moody’s and investors backed out of bonds that were being issued on behalf of the university.
And there was screaming and shouting, with LSU System president King Alexander saying they’re assembling the documents they’d need for filing financial exigency — the academic equivalent of bankruptcy.
“We’ve got to hold our breath,” Alexander said of the uncertainty of state funding for higher education.
And now Governor Jindal is threatening to veto the whole budget — if, in essence, lawmakers don’t do it his way.
Editor's Note: This story has been updated to clarify that CMS has objected specifically to the advance lease payments in the hospital privatization deals.