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|State Bond Commission Approves $33.8 Million for Local Projects |
BATON ROUGE, LA - The State Bond Commission approved $33.8 million for projects statewide and approved more than $1.8 million in interest savings at its Jan. 29 meeting, according to State Treasurer John Kennedy.
"I can think of nothing more important to a community than firefighting equipment," said Treasurer Kennedy. "The actions we took today will ensure that residents in Jefferson Davis Parish Fire Protection District No. 4 and the city of Abbeville have vital equipment that saves lives."
Among the individual projects approved were:
- DeSoto Parish, $7.5 million in General Obligation School Refunding Bonds for DeSoto Parish School District No. 4: saving taxpayers $468,496.
- Jefferson Davis Parish, $350,000 in Excess Revenue Certificates of Indebtedness for Fire Protection District No. 4: for acquiring, constructing and improving other firefighting equipment to be used in giving fire protection.
- Lafayette Parish, $2.1 million in Public Improvement Sales Tax Refunding Bonds and $14.5 million in Public Improvement Sales Tax Refunding Bonds for the city of Lafayette: saving taxpayers $1.4 million.
- Ouachita Parish, $7.75 million in Revenue Bonds for the Louisiana Community Development Authority's University of Louisiana Monroe Facilities Inc., - Student Housing Project: for (1) design, development, construction, equipping, and renovation of residence halls for students who are members of sororities and (2) funding a deposit to a debt service fund and capitalized interest, if necessary.
- Union Parish, $1 million in Revenue Bonds for the town of Farmerville: for construction of utility infrastructure, turn lane and related public improvements to enhance economic development within or adjacent to the Farmerville Economic Development Area.
- Vermilion Parish, $600,000 in Revenue Bonds for the city of Abbeville: for acquiring fire trucks and fire protection equipment.
The Louisiana State Bond Commission meets monthly to review and approve applications from parishes, municipalities, special taxing districts, and other political subdivisions of the State requesting authority to incur debt. For more information, visit www.LATreasury.com.
|Treasurer Kennedy: End All State Contracts With Convicted Consultant|
BATON ROUGE, LA -State Treasurer John Kennedy urged state officials today to cancel any existing consulting contracts with consultant Dr. Kera E. Moseley and her companies.
"Dr. Moseley was found guilty last week of fraudulently collecting more than $15,000 in food stamps and child care assistance," said Treasurer Kennedy. "This was taxpayer money. Dr. Moseley also has contracted with the state to provide consulting services. We have too many consultants as it is, and we certainly don't need a consultant who stole taxpayer dollars."
A judge in the 22nd Judicial District found Moseley guilty of felony theft for fraudulently receiving $15,431 in food stamps and child care assistance by not disclosing her employment. Over the years, Moseley held consulting contracts with the Louisiana Department of Health and Hospitals, among other state agencies."State government has thousands of consulting contracts and a nearly $2 billion budget shortfall," said Treasurer Kennedy. "We need to cut ties with many of those consultants. We especially need to cut ties with consultants convicted of defrauding us."
|State Revenues Continue To Drop|
BATON ROUGE, La. - The December 2015 Net Receipts Report shows that total state revenue thus far for 2015-2016 was $3.469 billion, a 15% decrease compared to that time last year. Sales tax, severance tax and corporation/franchise tax receipts continue to lag. Individual income tax revenue is relatively flat.
A month ago, in the November 2015 Net Receipts Report, total state revenue was down 12%. The December report shows the drop is getting bigger even though growth was anticipated in the five year base line projection.
The report includes receipts for sales tax, individual income tax, general severance tax, corporation and franchise tax, gasoline and special fuels tax and miscellaneous taxes cash receipts. The report does not include gambling revenues, fees, self-generated revenue and statutory dedications.
General sales tax cash receipts for FY 2015-2016 to-date are $1.358 billion, for a decrease of $20 million or 1% compared to last year. General sales tax cash receipts this time last year were $1.378 billion, which was $73 million more than the prior year.
Individual income tax cash receipts for FY 2015-2016 to-date are $1.538 billion, for an increase of $6 million or 0% compared to last year. Individual income tax cash receipts this time last year were $1.532 billion, which was $3 million more than the prior year.
General severance tax cash receipts for FY 2015-2016 to-date are $260 million, for a decrease of $193 million or 43% compared to last year. General severance tax cash receipts this time last year were $453 million, which was $27 million more than the prior year.
Corporation and franchise tax cash receipts for FY 2015-2016 to-date are a negative $154 million, for a decrease of $469 million or 149% compared to last year. Corporation and franchise tax cash receipts this time last year were $315 million, which was $3 million more than the prior year.
Gasoline and special fuels tax cash receipts for FY 2015-2016 to-date are $312 million, for an increase of $5 million or 2% compared to last year. Gasoline and special fuels tax cash receipts this time last year were $307 million, which was $10 million more than the prior year.
Miscellaneous taxes cash receipts for FY 2015-2016 to-date are $99 million, for a decrease of $10 million or 9% compared to last year. Miscellaneous taxes cash receipts this time last year were $109 million, which was $12 million more than the prior year.
To view the report in its entirety, visit www.latreasury.com and click "Net Receipts Statement for the Month of December 2015."
|Higher Taxes Could Hurt Economy|
Winston Churchill said that "for a nation to try to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle."
It's no secret that many parts of Louisiana's economy are sluggish right now, especially the oil patch.
Times are tough, and there is talk about making them even tougher by raising revenue through tax increases. Yes, the state, as usual, is strapped for cash. Yes, we're facing, as usual, a large shortfall in the state budget. But do you think the average oil industry worker is washing down his caviar with the finest magnum of champagne right now? If you do, let me introduce you to "George."
George is a hard-working landman with a wife and a mortgage. He's got a roof that needs replacing, a truck that rattles instead of purrs and a baby on the way.
As a landman, George works in the oil and gas industry, which is experiencing more twists and turns right now than a "Game of Thrones" episode. The industry is bleeding jobs. Businesses are closing. More workers are joining the unemployment line every day. They just hope they don't have to join the bread line.
George devoted more than a decade to a company that folded last year. He found another job, but it pays less. So he mows lawns on the weekends to keep groceries in the house and the foreclosure man at bay.
The tide will turn for the oil industry, but we're going to have to be patient. Esteemed economists Loren Scott and Jim Richardson recently released their "Louisiana Outlook: 2016 and 2017." I'll give you the summarized forecast by area. You might want to reach for the aspirin.
The year 2016 is expected to mean meager growth for New Orleans, flat growth for Monroe, modest growth for Alexandria and an altogether bad year for Shreveport-Bossier City, Lafayette and Houma. The bright spots are Baton Rouge and Lake Charles.
The truth is the state budget has been mismanaged for many years. I don't envy any public official who walks into office with a $1.9 billion budget hole to fill, but they had better be careful trying to fill it by burdening our citizens with higher taxes. Many of our people are living at the margins right now. It could also tank an already shaky economy.
Oil recently slid below $30 a barrel. Prices could go lower. Yes, we've diversified our state budget so we're not as dependent on the oil and gas industry - and that's a good thing. However, that industry still buys a lot of homes, kids' braces and minivans in Louisiana. Maybe you just worked offshore one summer before college. More likely, you know someone still working offshore or selling oil field equipment. Those folks are hurting right now. And we want to charge them more for the government services they receive. We are not one tax increase away from prosperity.
Now I know what you're thinking. It's easy to criticize, but it's difficult to offer an alternative solution. So I'll offer you a few ideas.
We have 19,000 consulting contracts. Does anyone really believe we need all of them? Does anyone believe these consultants wouldn't give the Governor and the Legislature a 5% discount if they asked?
Twenty-two percent of all of the managers in the state's classified service manage one employee. The average manager manages four employees. We have too many generals and not enough foot soldiers.
Each year, taxpayers pay for 900,000 visits to expensive emergency rooms for nonemergencies, such as acne, mild sunburns, obesity counseling and pregnancy tests. Imagine how much money we could save if we reduced that by 20%.
According to the Federal Centers for Medicare and Medicaid Services, 10% of the $8.3 billion the state is spending on Medicaid is fraud. That's $830 million of fraudulent payments every year.
We need to be very careful how we fix our state budget. Burdensome taxes will be like throwing gas on an already out-of-control fire. Let's give the Georges of Louisiana time to recover from this downturn in the economy. I have a multitude of ideas on how we can right this ship. I'm eager to hear other people's ideas.
It's the spending, stupid.
|Food Stamp Work Requirement Makes Sense|
Governor-Elect John Bel Edwards is thinking about waiving the requirement that able-bodied adults without dependents get a job, receive job training or perform public service as a condition of receiving food stamps. To waive this requirement would be a mistake. Here's why.
In 1961, Alderson Muncy was in dire circumstances. A drop in the nation's demand for coal had cost Muncy his job at a West Virginia mine. He lived in the poorest part of a poor state and had a wife and 13 children to feed.
The poverty in West Virginia touched the hearts of people across America. Muncy and his wife, Chloe, became the first recipients in the U.S. of food stamps. Handed $95 in food stamps, they used just $20 worth. Months later, they started chipping in for the cost of the food stamps after Alderson Muncy got a temporary job. Within six years they were off food stamps altogether after Alderson Muncy found work with the state highway department.
The Muncy family exemplified the founding goal of the food stamp program. The program was never meant to produce a population that is dependent on government assistance. Food stamps are supposed to be temporary, short-term assistance: a bridge, not a parking lot.
Consider this. The food stamp program cost us as a nation $68 billion in 2010. This year, the cost was $73.8 billion even though the national unemployment rate has steadily dropped in five years. It isn't sustainable, especially when you consider that the federal government has more than 70 anti-poverty programs that provide cash, food, housing, medical care and social services to the low income. We're not doing enough to help people thrive on their own.
A Democratic president and a Republican-led Congress enacted a much needed reform in 1996 by requiring able-bodied adults without dependents to work at least 20 hours a week or participate in job training in order to receive food stamps. If you can't find a paying job or a training program that works for you, then you can do volunteer work or take an unpaid job. This reform was designed to help people help themselves.
Again, we're only talking about able-bodied adults without dependents. We're not talking about anyone younger than 18. We're not talking about anyone older than 50. We're not talking about the mentally ill or those physically unfit to work. We're not talking about a mother with a hungry child in her arms.
The Brookings Institute puts it bluntly: The only way out of poverty is to work. Yet work rates for men in the U.S. are spiraling downward.
Louisiana received a waiver to the work requirement for food stamps during the 2008 recession. Earlier this year, we wisely decided to let the waiver expire, following the lead of more than a dozen other states. I hope we continue to keep that waiver tossed out the window. We don't need it.
Kansas dropped the waiver and saw unemployment rates decrease. Maine did the same thing, and volunteerism skyrocketed.
I'm not telling people to starve. I'm telling them to grasp the hand extended to them, get a boost up the ladder and then let that hand go so the next person can be helped. I'm telling them that we don't want them to remain mired in poverty. I'm telling them to embrace the American dream and help devote limited resources to the old and the sick and the very young. Thrive so others less fortunate can survive.
|Medicaid Expansion Should Be On Louisiana's Terms|
It looks like Louisiana is about to add between 200,000 and 300,000 people to the Medicaid rolls, assuming Gov.-elect John Bel Edwards follows through on his campaign promise to join the Medicaid portion of the Affordable Care Act (Obamacare), as I think he will.
Here's my request of our new governor and Legislature: If Medicaid expansion is to become the law of the land in Louisiana, then toss in some taxpayer-friendly safeguards as Arkansas, Iowa, Pennsylvania, Michigan, Arizona and other states did. Medicaid is a massively expensive program, and we're combing the couch cushions for loose change as it is. We need to inject the Medicaid program with a healthy dose of common sense reform.
Americans are the most generous, compassionate people in the world. If you are hungry, we will feed you. If you are homeless, we will house you. If you are sick, we will pay for your doctor.
But this generosity comes at a cost.
With Medicaid, you want people who qualify to benefit from the program. You don't want unqualified people to be able to game the system. You also don't want a Rolls Royce model for delivering Medicaid. You want a trusty model that works while making every taxpayer dollar stretch as far as it can.
It's no secret that I'm among the skeptics when it comes to the current structure of the Medicaid program. I just don't think it's a good model for delivering health care. Every year taxpayers spend more and more money, yet Medicaid patients seem to get sicker and sicker.
Medicaid will cost Louisiana more than $8 billion this year, and we're already running short of the money needed to cover expenses. Medicaid enrollment swelled, among other things, catching us by surprise to the tune of more than $500 million. The program isn't sustainable unless we want to close LSU, let everyone off death row, tell our kids to learn to read on their own and commit every single taxpayer dollar we take in to Medicaid. We're at the tipping point.
We also now know that Medicaid expansion isn't going to save the state more than $100 million as promised. The Legislative Fiscal Office has warned that the projected savings need to be decreased.
Other states thought hard about controlling Medicaid costs when they expanded Medicaid under Obamacare and came up with some ideas that we should consider.
1. Using the new Medicaid funds to buy private insurance for patients or to enroll them in cost-saving managed care programs.
2. Reserving the right to terminate the Medicaid expansion if the federal government backs out of its promise to pay 90% of the costs.
3. Providing incentives for patients to quit smoking, lose weight and change unhealthy behavior.
4. Requiring small premiums of $5 to $10 a month, so patients have "skin in the game."
5. Requiring co-payments of a few dollars for each doctor or hospital visit, again requiring skin in the game.
6. Declining to pay for nonemergency transportation to the doctor or hospital.
7. Requiring larger co-payments for visits to expensive emergency rooms for nonemergencies.
8. Requiring able-bodied Medicaid recipients to get a job or take job training classes.
These reforms are quite modest, will save millions of dollars and will only apply to the new Medicaid patients added under Obamacare, who make more money than traditional Medicaid patients.
Just because we expand Medicaid doesn't mean we have to do it strictly on the federal government's terms. We, as a state, put taxpayer money into Medicaid, too. We should have input into how health care is delivered, especially when taxpayer dollars are paying for it.