PLAN TO AVOID FISCAL CLIFF- The Louisiana Revenue Estimating Conference released some positive news on Louisiana's income projections last week, based on the recommendations of two economists, … the Conference increased revenue projections by $153 million for the current financial year that ends June 30th. Next year's forecast was boosted by nearly $234 million. While this is better news than expected… still it's not enough to dig Louisiana out of the estimated $1.5 Billion-dollar hole, known "fiscal cliff," that hits when the state loses its 1-cent sales tax on June 30th. Yesterday Gov. John Bel Edwards met with a group from the Committee of 100, the Public Affairs Research Council, the Council for a Better Louisiana, and the Louisiana Budget Project, to offer an overview of his plan to deal with the state’s
upcoming fiscal crisis. “All of the proposals that I am making come from the legislatively–created task force. And in that sense, I’m proposing to the Legislature that it adopt its plan” explained Edwards. The plan Edwards was talking about includes: compressing individual income tax brackets; cutting the allowance for federal excess itemized deductions by 50 percent; expanding sales tax to include services; and
cleaning the remaining four pennies of sales tax, with the fifth penny going away. Now if you’ll remember…this plan has been pretty much the same plan that legislators have rejected before…which begs the question…why should it get a greenlight now? “The legislators’ toes weren’t dangling off the edge of the cliff yet, "Edwards explained. “If we don’t fix the cliff, no one is going to want to put their name on the cuts
that are necessary,” he predicted. “In fact, I will tell you this, on Jan. 19, Jay Dardenne and I are going to present an executive budget proposal to the Legislature that we don’t want to put our name on!We don’t ever want that budget to be implemented, which is why we have to fix the problem."
And The Fiscal Cliff problem is imminent,--with $1 billion-PLUS in revenue falling off the books July 1st. Edwards will present his budget proposal in January…the Regular Legislative Session Convenes in March.