Louisiana gives away more than $7 billion each year through various tax exemptions, exclusions and other tax breaks, usually without much public scrutiny. But the chair of the tax-writing House Ways and Means Committee wants to change that. Rep. Stuart Bishop’s House Bill 641, scheduled for debate on Tuesday, would eliminate more than 100 tax breaks unless lawmakers approve each of them on a case-by-case basis by Jan. 1, 2027. The Advocate’s Tyler Bridges reports on the tough road ahead for Bishop’s bill and why the chair is trying to rein in the state’s vast web of tax credits and exemptions.
“We cannot continue to say our tax system is broken, that we pay too much in taxes, until we look at all the giveaway programs,” Bishop said. Tax experts have repeatedly made the same argument: Louisiana cannot simplify its complicated tax system and reduce tax rates until it closes loopholes. “I’m sure there are tax provisions that don’t really accomplish what we think they accomplish,” said Jim Richardson, a retired LSU economist who has chaired blue-ribbon tax commissions. “In a number of cases, we’d get their activity even with the tax break.”
Ways and Means has taken a conservative approach to approving new tax credits this session, keeping dozens of bills bottled up in committee. Committee members have been more generous to the oil and gas industry, approving a costly tax cut in severance taxes.
Callous indifference on minimum wage
Last week, lawmakers advanced legislation to give themselves a pay raise, but rejected a proposal to increase the state minimum wage. While members of the House and Governmental Affairs Committee approved of increasing legislators’ base pay from $16,800 to around $40,000 per year, their colleagues on the Labor Committee shot down an attempt to establish a modest $10 an hour wage floor for workers. The Louisiana Illuminators Greg LaRose attempts to understand the callous indifference some lawmakers are showing:
A minimum wage increase isn’t about making someone content to stay too long at a job meant for people just entering the workforce. Actually, it correlates directly to why their families languish in hardship. … I probably didn’t pay enough attention in the lone economics course I took in college. What I do remember is being confused that economic liberalism is a tenet of the politically conservative. Maybe that’s why GOP lawmakers struggle with what to do about the minimum wage. You’d hate to think it’s heartless indifference toward people we rely on to care for, clean up and feed us.
Louisiana’s Medicaid expansion will live on
Gov. John Bel Edwards expanded Medicaid eligibility on his first full day in office, a move that he often cites as his “easiest big decision” as governor. Nearly eight years later, and after more than 777,000 people have gained access to health coverage, no major candidates vying to replace Edwards are calling to undo his move. The wisdom of extending Medicaid eligibility to low-income adults continues to be borne out by the benefits it has provided to Louisiana and the experience of states that have refused to do so. That’s why, as The Advocate’s Stephanie Grace explains, the policy choice will outlive Edwards’ administration.
The truth is that there never was a policy-based argument for states to have the choice. The ACA was written so that Medicaid expansion would cover everyone too poor to qualify for private sector subsidies; cutting it out only became an option once the U.S. Supreme Court ruled, handing opportunistic state-level politicians — again, see [former-Gov. Bobby] Jindal — a new way to declare themselves anti-Obamacare. The good news is that here, with the program’s success out there for all to see, that fever seems to have broken, even among the most partisan of potential governors. That should be a lesson for our allegedly higher-functioning neighbors — take care of your people already! — and also one for anyone from either (or no) party hoping to steer Louisiana through its many non-healthcare challenges: Sometimes, hopefully more often than not, it’s the results that matter.
Expanded SNAP decreased hunger
A significant share of households are reporting food insufficiency as pandemic-era benefits expire and costs increase, according to a recent U.S. Census report. Now, 1 in 4 households are experiencing the same levels of hunger as states that did not participate in a program that enhanced Supplemental Nutrition Assistance Program benefits during the pandemic. Route Fifty’s Molly Bolan reports on the findings that show how the enhanced benefits decreased hunger in states that participated, and the predictable increase in hunger in the first full period since those benefits expired.
For some households that received benefits up until the program’s termination, the policy change has major implications. For instance, a family of four with a net monthly income of $2,000 received $939 more in SNAP benefits this year compared to before the pandemic began, the report said. With the end of the emergency allotments, that family is now receiving $600 less each month. In total, roughly 32 million people are receiving smaller monthly SNAP payments. While all states were distributing emergency allotments of SNAP benefits by the end of 2020, 17 opted out of the program two years later, arguing that the enhanced benefits were contributing to the worker shortage.
Number of the Day
$7.3 billion – Amount that state tax breaks cost the state for the 2022-23 fiscal year. The revenue from these tax breaks could be used to fund vital programs and services across the state. (Source: Louisiana Department of Revenue)