The Revenue Estimating Conference met Wednesday, and we finally have updated figures on the status of the state budget. For the current fiscal year, there’s still a deficit.
“You’re about at 66-million,” House Fiscal Officer Patrick Goldsmith told the panel.
Governor John Bel Edwards had said Monday he thought the estimated deficit would come in lower, between $30-million and $60-million.
However, the projected deficit for FY 17, which starts July 1, 2016, is lower than expected.
“That 800-figure we had talked about is going to drop down to about 750,” Goldsmith said.
That’s $750-million – a substantial shortfall, but much smaller than the $2.2 billion chasm Louisiana faced before the special session.
Legislative Fiscal Analyst Greg Albrecht says the biggest infusions of additional cash come from the sales tax bills passed last week.
“Call it the new penny bill. For the most part, this bill will generate money rapidly because you’re going to change the register from 4 percent to 5 percent.”
Coupled with the bill that stripped some exemptions from the existing four cents of state sales tax, this increases state revenue by $300-million for the last three months of this fiscal year, and by $1.2-billion in the next.
Albrecht cautions there are no guarantees the taxes will be paid properly.
“I think you’re going to have some compliance issues and education issues with taxpayers to know about this.”
REC chairman Jim Richardson wanted to know if the new laws contained any glaring loopholes that might prevent the state getting the money on time.
“Is there any ways, from a taxpayer’s perspective, they find ‘How do I avoid this tax’?” Richardson wondered.
“No doubt they’ll try to figure out ways,” Albrecht replied.
“Are there ways to avoid it?”
“I’m sure there are,” Albrecht said, “But I don’t know how to.”
Senate President John Alario summed up the general feeling about the report—and the funding situation.
“I reluctantly move to accept it, as is,” Alario said, with a sigh.