Roemer Ponders Special Session To Ward Off Fiscal Crisis

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Gov. Buddy Roemer of Louisiana is weighing whether to call lawmakers into special session in an effort to ward off impending fiscal crises at the state and local levels.

School districts' financial problems are due mainly to the legislature's decision last year to back only part of Mr. Roemer's plan to shift responsibility for some $300 million in "non-instructional" costs from the state to the local level. Lawmakers approved that change but voted against a related bill that would have provided districts with new taxing authority to cover their higher costs.

The state, meanwhile, must find new revenues to shore up its teacher-retirement system and finance a promised $93-million pay raise for teachers. It also stands to lose nearly $200 million in general-fund rev4enues if a tax on oil production is allowed to expire this year.

The Governor is "looking at what has to be done for us survive," said Stephanie Desselle, Mr. Roemer's education aide.

Calling a special session to address tax matters is one of the few options available to the Governor for dealing with the looming crisis.

Although the legislature will meet in regular session in April, the state constitution forbids tax increases in such sessions in odd-numbered years.

Ms. Desselle said lawmakers may be asked to alter elements of state's tax system during the regular session on the grounds that the changes are a "continuance of a tax" rather than a tax increase. She said, however, it is unclear whether that move would be con8stitutional.

Reforms championed by the Governor during the 1988 session are at the heart of the looming shortfall for education.

Mr. Roemer originally proposed that the state stop paying districts' utility and transportation costs, and that districts be given authority to raise local sales taxes to cover those expenses.

Lawmakers approved the first part of the proposal during last year's regular session, but rejected the tax provisions during a special session late last summer.

Although the Governor agreed to continue state payment of districts' non-instructional costs this year, he "is committed to not continuing it," Ms. Desselle said.

If lawmakers fail to authorize the local tax increases this year, either districts or the state will "have to deal with a $300-million problem," Ms. Desselle added.

The problem will be compounded if the Governor and lawmakers cannot agree on how to come up with $93 million to finance the second year of a pay raise also approved last year.

In addition, Louisiana has committed itself to begin reducing the unfunded liability of its teacher-retirement system this year. That obligation is expected to drain nearly $60 million from the state's school-foundation program.

Mr. Roemer has proposed several tax changes to address these financial problems. They include higher business taxes and shifting the state's reliance from sales to property taxes.

Ms. Desselle noted, however, that last year's special session suggests that lawmakers may be reluctant to approve any major changes. In addition, recent polls indicate that "people are not in the mood to be taxed," she said.

In a related development, the Louisiana Board of Elementary and Secondary Education last month approved a $1.47-billion school-aid budget for the upcoming fiscal year.

Under Louisiana law, the state board is empowered to determine the school-aid level. Its proposal will be submitted to a legislative budget panel, which can recommend, but not order, changes.

In addition, a private research group has issued a report that is expected to influence board deliberations this year over major changes in the school-finance formula.

The 31-page document by the the Public Affairs Research Council of Louisiana Inc. recommends that communities bear a greater share of school costs, and that the state focus its efforts on equalizing spending among districts.

Vol. 08, Issue 20

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