The Louisiana Legislature wrapped up its special session on June 30 under a cloud of economic recession and rising coronavirus case numbers. Uncharacteristically passing a budget with hours, instead of minutes, to spare, the state Legislature leveraged one-time federal money and the state rainy day fund to plug a nearly $900 million shortfall. Depending on the pace of economic recovery and any additional federal stimulus plans, an October special session is likely.
In the final days of the session, Democrats successfully spearheaded a plan that allows Louisiana’s essential workers making less than $50,000 per year to apply for a one-time $250 check. Legislators put on hold pay raises for state employees. Ultimately, the state Civil Service Board will decide whether to proceed with those raises, and if so, face having state agency budgets cut later this year.
The Louisiana Association of Business and Industry and other business lobbyist groups saw significant returns on their fall campaign investments. With Republicans securing a supermajority in the Senate and only a couple seats shy in the House, business tax cuts and tort reform dominated conversations at the Capitol over the last 30 days. The budget includes almost $25 million in business tax breaks in the upcoming fiscal year, including big wins for the gambling industry. Official estimates expect a total loss in state collections of $230 million over the next five years. Still, Republican legislators dispute those numbers, arguing the cuts will allow for business growth that offsets those cuts.
The federal aid package originally reserved $811 million for local governments to offset costs associated with the novel coronavirus, but the state Legislature approved using $300 million of that to assist small businesses. The state-run grant program allows companies that have not otherwise received stimulus money related to the virus to apply for up to $15,000 in funds. Joel Robideaux, Lafayette’s former mayor-president, and Jason DeCuir headed up the economic recovery taskforce and spearheaded the development of the grant program. They drew criticism for political cronyism after bidding for the $15 million contract to administer the program.
Insurance companies also enjoyed a major win with the passage of “tort reform” legislation, which places new restrictions on those looking to sue for compensation from auto accidents. Though Gov. John Bel Edwards vetoed a previous version of the bill passed in the regular session, this version includes compromise language the governor intends to sign into law. Legislators have expressed hope that by limiting lawsuits, the cost savings to insurance companies will trickle down and reduce the high cost of auto insurance in Louisiana. However, the bill does not guarantee savings in premiums.
In anticipation of life slowly returning to normal in the fall, the Legislature passed a bill that prevents lawsuits against universities and schools over coronavirus claims. School boards and colleges are still developing contingency plans for the fall, but the bill requires they spell out safety plans for students, faculty and staff.
House Republicans once again circulated a petition to override Gov. Edwards’ phased reopening of the state but fell short of gathering the needed support. Critics say Edwards’ decision to delay moving to Phase 3 is a partisan issue. However, Republican Texas Gov. Greg Abbot and Florida Gov. Ron DeSantis have both scaled back their states’ reopenings after recent surges in coronavirus cases in their states.
The Legislature staked out an independent course this session, calling itself into special session and seeking to limit Edwards’ emergency powers. These disputes echo those faced in other states like North Carolina and Kansas, where Republican state Legislatures have worked to strip Democratic governors of power. But even in neighboring Mississippi, the Republican Legislature attempted to limit Republican Gov. Tate Reeves’ powers in the face of the pandemic. Typically, governors have had considerable latitude in emergency oversight, including spending federal emergency relief aid. But this pandemic has pushed many state legislatures to reach for greater control. While Louisiana politics has for decades been marked by the strong powers held by the governor, this special session and pandemic spell sharp battles for legislative independence along the long road to recovery.