Varied opinions on how to solve the budget crisis on evening of - FOX 8 WVUE New Orleans News, Weather, Sports, Social

Varied opinions on how to solve the budget crisis on evening of governor's televised speech

NEW ORLEANS (WVUE) -

Just hours before Governor John Bel Edwards took to the airwaves to discuss the budget crisis, opinions varied on the best solutions to one of the worst money dilemmas in state history.

Even before announcing he would deliver a speech for all to see, the new democratic governor warned that things were getting worse financially and that without new revenues the consequences would be dire.

"You're going to see hospital closures, you're going to see TOPS Scholarship money that will not be available,” Governor Edwards said recently.

Republican State Rep. Julie Stokes talked about what she hoped to hear during the unprecedented televised speech.

“I think that the more attempts to be just honest, and genuine with the people of Louisiana, explain the fiscal situation, how we got here why there's only so many solutions that can work, the more productive that talk will be,” Stokes said.

As of this week, the money shortfall for the current budget year is approaching $900 million, and for the fiscal year that begins July 1 is projected to be $2 billion.

The governor has proposed tapping into the state’s rainy day fund, trimming money in statutorily dedicated funds that are not shielded by the state constitution, as well as raising the state sales tax by a penny.

"We've had 10,000 people laid off, they can't pay any more taxes for an income tax.  They can't pay any more in sales taxes," said State Treasurer John Kennedy, a republican. "I mean, this tax package of his could wreck this economy.”

In recent months the fiscal problems have been made worse by stubbornly low oil prices that have cost thousands in Louisiana oil industry a paycheck.

Sales and income tax revenues flowing into state government’s bank account are also lagging, according to state economists.

The governor proposes raising the sales tax in the short term and longer terms he wants to rework state income tax brackets to help state government’s bottom line.

"I think something has to give on the spending side and some things are going to have to give on the revenue side in order to make this work,” said Robert Travis Scott, President of the Public Affairs Research Council.

Though many republicans hope to put up a wall of resistance to any new taxes, not all share that mindset.

"Cutting is not going to be sole solution," Rep. Stokes said. "As much as I would love to be able to stand here and say that and as popular and more favorable that would be for me to say that we're not in that environment right now."

Scott said when tax hikes are in the mix, there needs to be a strong commitment by the governor to trim and hold down future spending.

"Let's assure the public if taxes are raised that we're also going to hold down spending,” Scott said.

Rep. Stokes who is a certified public accountant said she has been poring over the budget numbers on the spending side and the revenue side.

She said the state’s colleges and universities have been hit hard already.

"Our Higher Ed system has been cut more than any other Higher Ed system in the United States," she said. "I don't think there's a whole lot of room left there to cut without a substantial overhaul and the deeper you get into it the more and more difficult you can see that that overhaul would be."

Sunday the governor will open a special legislative session in hopes of reaching consensus with state lawmakers on how to solve the structural budget crises.

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