La. Gov.’s Spending Plans Approved by House Appropriations Committee

A nearly $2 billion package of pay raises, road repairs, insurance rebates, health care and other spending sought by Louisiana Gov. Kathleen Blanco easily sped through a House committee Dec. 9.

The House Appropriations Committee also agreed to a technical change critical to Blanco’s plans – legislation that would let the state change a spending cap and more easily dole out the dollars.

It was a day of quick victories for Blanco, who testified before the Appropriations Committee and the House’s other money panel, the Ways and Means Committee. The two panels signed off on nearly all the governor’s spending plans, with the Ways and Means Committee agreeing to nearly $300 million in annual tax breaks.

“We can afford to do all these things,” the governor said in her testimony.

But both panels are stacked with Blanco’s allies, so the first true test vote on her spending initiatives will come in the full House, where all the legislation next heads. The House was expected to begin debating the bills on Dec. 10.

Many lawmakers in both the House and Senate have questioned whether the governor is trying to spend too much new state cash too quickly and with too little public debate. Republican lawmakers said they will attempt to block any plans to exceed the state’s current spending cap. If successful, any spending over $194 million could be stalled.

As much as $2.4 billion in new money became available after revenue estimates were revised for last year and this year to reflect boosts in state taxes in the post-hurricane recovery and with a continuing rise in oil and gas prices. Blanco wants lawmakers to agree to ways to spend much of that new cash in the 10-day legislative session that must end Dec. 17.

“This is a targeted and responsible plan that uses conservative budget figures,” Blanco said.

Without objection, the House Appropriations Committee agreed to pay raises for public school teachers; college professors; school support staff like cafeteria workers and janitors; police, firefighters and other local law enforcement; state troopers; prison, probation and parole officers; and state employees.

Committee members boosted some of the raises further, mainly for law enforcement agencies.

“The people of the state really want to see them rewarded for all the work they have done,” said Rep. John Alario, D-Westwego, chairman of the committee.

Among the biggest pay bumps would go to teachers, who would receive a $2,100 annual pay raise; state police, who would receive pay hikes upward of $3,000 a year; and wildlife and fisheries enforcement agents, who would could get salary increases as large as $6,900 a year.

The committee also added $1.2 million to market the Essence Music Festival, which is returning to New Orleans after Hurricane Katrina, and added money for 18 new jobs in the governor’s homeland security office.

Other spending plans pushed by Blanco and approved by the committee were:

-$238 million to give refund checks to homeowners who paid more in insurance costs because of the Louisiana Citizens Property Insurance Corp. The state-run insurance company borrowed millions to pay claims, and those costs are being passed along to insured homeowners statewide. Blanco staff said people should start getting rebate checks in February, if approved.
-$56 million taken from a state set-aside fund for emergencies and used to avoid higher insurance costs for homeowners in 2007 because of Citizens.
-$300 million moved to a durable goods manufacturing fund to attract a $3 billion steel mill to south Louisiana.
-$200 million in health care items, including technology for doctors to track patients’ medical histories, payments to beef up mental health care in the New Orleans area, money to doctors who take care of uninsured patients and pay increases for workers at nursing homes and other institutional care facilities.

A plan for divvying up a pool of surplus cash from last year also was approved, though the money has yet to be recognized for spending. Surplus dollars would go to 100 road repair and construction projects, retirement debt payment, repairs on college campuses and the construction and planning of a cancer research facility in New Orleans.

The only disagreements in the House committee meeting came over spending limits. The state can spend another $194 million this budget year before hitting a spending cap. After that, each spending item would require a two-thirds vote from the House and Senate, sometimes a hefty target to reach.

Blanco is asking lawmakers to change the spending limit for this year so her pay raises and other budgetary plans would require only majority votes in the Legislature. Changing the cap, however, takes a two-thirds vote – and GOP legislators are balking at approval. If they vote together, Republicans have enough votes to block any adjustments to the spending limit.

Jim Patterson, with the Louisiana Association of Business and Industry, said the spending cap was approved by lawmakers in 1990 to constrain the growth of government. He urged lawmakers not to change it in the special session. Patterson said Louisiana residents should get more time to review proposals he said were a “hastily put together plan to use windfall revenue.”

Lawmakers have debated the pay raises and other items included in the spending plans for years but haven’t had the money to fund them, said Commissioner of Administration Jerry Luke LeBlanc, the governor’s budget chief.

“This gives us an extraordinary opportunity to address a wide array of issues that have been on the plate for quite some time,” LeBlanc said.

Still, the vote for the spending cap change was 13-3.

“Some of us are squeamish,” said Rep. Dan “Blade” Morrish, R-Jennings, an opponent of the legislation.

House Concurrent Resolution 6 and House Bills 31, 52, 57, 72, 80, 82, 84, 89 and 90 all can be found at www.legis.state.la.us.