The House Ways and Means Committee met Wednesday to continue discussing the potential repeal of Louisiana’s personal and corporate income tax, which brings in nearly $5 billion a year that supports health care, higher education, public safety and other programs in every community in the state. While supporters of a repeal often note that fast-growing states like Texas and Florida have no state income tax, state taxes aren’t huge motivators for why families decided to move. The Center on Budget and Policy Priorities’ Michael Mazerov explains why tax-related migration is grossly exaggerated:
Most people in the U.S. plant roots in the places they live, and it takes a lot to uproot and move across state lines. Only about 1.5 percent of people make interstate moves in any given year. For those who do move, what attracts them to one state over another? For some it’s a job opportunity. For others it’s family, housing, or even better weather. One factor that comes up rarely, if ever, is taxes. That doesn’t stop anti-tax advocates from claiming that proposals to raise state revenues will drive people, especially high-income people, away.
Mazerov points to migration data from two fast-growing states – Georgia and North Carolina – that have state income taxes:
Many people left no-income-tax Florida for states levying income taxes. Florida famously attracts a lot of interstate migrants, but many people also leave the state each year — including to states with higher taxes. Georgia has an income tax, but almost 15,000 more households moved from Florida to Georgia than vice versa. Similarly, North Carolina has had an above-average income tax rate for the Sunbelt (despite recent cuts), yet almost 18,000 more households moved from Florida to North Carolina than did the opposite.
Green banks support states’ transition to renewable energy
In recent years several states have supported or created specialized banks that lend money to businesses and homeowners for climate-friendly and energy-saving projects. “Green banks” provide financing – many by using public money to attract private investments – to support states’ transition to renewable energy sources. Stateline’s Alex Brown explains how these financial institutions work:
Like conventional banks, green banks provide loans that must be repaid, but they often offer long-term, low-interest loans that aren’t available on the private market. Some use other tools to lower risk for private lenders or to finance projects in partnership with utilities. Green banks can be public, quasi-public or nonprofit institutions. Several green banks have been established by state lawmakers, governors or agencies, often with some level of state funding. Many state-level green banks have focused much of their work in low- to moderate-income communities, which have the greatest need for energy upgrades and the least access to financing.
An influx of federal funds from the Greenhouse Gas Reduction Fund to aid green banks should be getting the attention of states, especially ones on the front-lines of climate change like Louisiana.
That fund will serve as a national green bank and is expected to distribute funding to existing green banks throughout the country. Leaders of state green banks say they expect the U.S. Environmental Protection Agency to provide funding details next month. “This is going to be completely game-changing and help us put our program on steroids,” said Doug Coward, executive director of the Solar and Energy Loan Fund, a Florida-based nonprofit green bank known as SELF that operates in four states.
SNAP benefits to return to pre-pandemic levels
The number of Americans experiencing hunger spiked during the Covid pandemic, but policy interventions like the increases to Supplemental Nutrition Assistance Program benefits helped lessen what would otherwise have been a far deeper crisis. But as BRProud’s Allison Bruhl explains, the extra SNAP benefits will return to pre-pandemic amounts this March.
According to the USDA Food and Nutrition Service, the extra benefits end after the Consolidated Appropriations Act was passed in December. SNAP recipients in Louisiana households were warned that some would see a decrease in benefits after a federal cost of living adjustment to Social Security and veterans benefits. “While Emergency Allotments are ending, households may be eligible for additional benefits if they have experienced an increase in size, a decrease in income, or an increase in costs associated with shelter, child care, or court-ordered child support,” officials said.
Click here for more information about temporary extra SNAP benefits ending.
Infrastructure money and labor market
The primary purpose of recent federal legislation – the Infrastructure Investment and Jobs Act, Inflation Reduction Act and the CHIPS Act – was not to stimulate the economy. But, the infusion of trillions of dollars of government spending will affect the labor market in several ways, such as creating new jobs and distributing workers across different sectors of the economy. The New York Times’ Lydia DePillis reports:
The funding comes as the economy is decelerating, and it may avert a sharper dip in employment brought on by the Federal Reserve’s attempts to contain inflation by raising interest rates. The construction industry, in particular, has been buffeted by a slowdown in new-home sales and stagnant demand for new offices. “By spring or summer, the job market will basically go flat,” said Mark Zandi, chief economist for Moody’s Analytics. “The infrastructure spending won’t kick in until late 2023, going into 2024. It feels like the handoff here could be reasonably graceful.”
Number of the Day
85,000 – Number of Louisiana residents that are no longer classified as living in rural areas after the U.S. Census Bureau revised methods of defining what counts as urban in the United States. (Source: U.S. Census Bureau via The Advocate)