Louisiana Legislature looks more likely to raise the spending cap – just not as much

BATON ROUGE, La. (Louisiana Illuminator) - The Louisiana Legislature on Monday looked more likely to increase the state spending cap to allow for extra money to flow toward transportation projects, university buildings and hospitals – though not as much as the Senate and Gov. John Bel Edwards had originally proposed.

The House Appropriations Committee voted 21-3 to allow lawmakers to spend as much as $1.65 billion more by raising the state’s spending limit over the next 13 months. That’s $650 million less than the Senate desired, though Senate President Page Cortez, R-Lafayette, was confident it wouldn’t result in drastic reductions to the Senate’s spending priorities.

State lawmakers must come to a consensus on their budget plan and the spending cap by Thursday evening, when the legislative session is scheduled to end. The two chambers have agreed to put public school teacher and school staff pay raises in the budget, but other spending pieces are still up in the air.

In addition to the teacher pay raises, the Senate voted overwhelmingly for a budget plan Monday afternoon that prioritized giving more money to water and sewerage projects, college and universities, law enforcement pay, and an incentive fund to lure more property insurance companies to Louisiana.

Lawmakers will make more changes to their budget plan over the next four days. Senate Finance Chairman Bodi White, R-Central, said he expected the House to reject the Senate budget plan and send the matter to a legislative conference committee, where negotiations over the state’s financial priorities will continue.

The conference committee process will be secretive, and jockeying over the state spending plan will continue largely behind doors for the next few days. House and Senate leaders will select six legislators — three from each chamber —  to negotiate on each one of the budget bills, but those talks won’t take place out in the open.

One major sticking point will likely be whether the full House is willing to vote to raise the spending cap. If House members don’t, coastal restoration projects, transportation funding, university building projects as well as money going to school boards, sheriffs, and other local government entities may be at risk for being eliminated.

House Speaker Clay Schexnayder, R-Gonzales, said Monday morning Senate and House leaders reached a deal to shrink the extra cap space from the $2.3 billion approved by the Senate to $1.65 billion. The two chambers have been at odds for weeks over how the government’s unprecedented amount of revenue should be dispersed but may be closer to reaching an overall agreement than they were a few days ago.

Nevertheless, conservative Republicans in the House have been trying to rally support to block any increase in the cap. Senators are united in favoring a plan that raises the limit to allow for more construction projects and hospital spending.

The committee vote Monday morning showed House conservatives are likely in a weakened position and might have already lost the fight to keep the current state cap in place. But they are still influencing negotiations, having gotten the Senate to agree to lower the threshold by hundreds of millions of dollars.

If lawmakers don’t raise the spending cap at all, they will have to put more than $1 billion in extra money toward paying down public debt and into savings accounts for future use. The Senate and Edwards have argued the money would be better spent on one-time building projects now — such as construction at universities and on bridges — because costs for those projects are likely to go up in future years.

House conservatives believe it is more fiscally responsible to set the money aside and prepare for an expected downturn in state revenue in 2025, when a massive sales tax cut takes place.

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