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PAR Clarifies Misleading Headline

PAR Clarifies Misleading Headline

Posted: 01/23/2004

An inaccurate headline on a story run statewide by various media has misled readers concerning the Public Affairs Research Council’s (PAR) position. The story was entitled “Official urges state to change oil, gas cap.” PAR did not urge the state to raise the cap on the amount of state oil and gas revenues that can go into the state’s general fund. As a member of a League of Women Voters luncheon panel this Thursday, PAR president Jim Brandt discussed this as one of a number of options under discussion as budget makers look forward to trying to close the over $500 million “budget gap” for fiscal year 2004-05.

The constitution provides that state mineral revenues exceeding $750 million a year go into a “Rainy Day” fund. By two-thirds vote, the Legislature may raise the cap by 50% of the prior ten-year increase in the CPI. This could potentially add $125 million for general fund spending if oil and gas prices remained high enough and the Revenue Estimating Conference concurred.

This idea of tapping the increase in oil and gas revenues the state is experiencing due to high prices was discussed at the December meeting of the state’s Revenue Estimating Conference. Legislators have been discussing the option for some time.

In his brief address, Brandt outlined a number of potential budget-balancing measures including the renewal of the temporary sales taxes on business utilities, another federal bailout, and program and spending cuts in addition to the oil and gas revenue cap change. With the exception of cutting low priority programs and eliminating inefficiencies wherever they might be found, PAR has not taken a position on any of these budget-balancing options.

Brandt stressed that it is still very early in the budgeting process and there are many unknowns. As the process unfolds, PAR will take a close look at all of the budget balancing options, including raising the cap on state mineral revenues. PAR’s intention, at this time, is not to suggest new ways legislators can raise money to increase spending, but rather to simply present the budget balancing options currently under discussion.

For More Information Contact:
Jim Brandt – President
(225) 926-8414 Ext. 21

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