The Louisiana Revenue Estimating Conference met Friday, January 13, 2017, to determine the state’s budget deficit for fiscal year 2017. Based on tax collections, which are below expectations, Louisiana’s economists estimate either a $340M or $502M deficit. The Revenue Estimating Conference ultimately concluded the state’s budget deficit for fiscal year 2017 is $340M, of which $313M in budget cuts will be needed.
Governor John Bel Edwards previously stated that any budget deficit requiring cuts in excess of $300M would require a special session by the legislature (similar to last year) in order to make those cuts and/or raise revenue. Thus, it is anticipated another special session will be requested by the Governor this year, assuming a special session is not otherwise blocked in some way by the state’s legislators.
Coupled with the fiscal regular session that begins in March and will likely involve large-scale tax reform discussions, 2017 is shaping up to be another interesting (and busy) year for Louisiana taxpayers.
The Louisiana and multistate business community should diligently follow the upcoming session(s) and be prepared to provide input or otherwise act with regard to any new legislation proposed this year by the legislature. The Jones Walker SALT Team will be closely following – and reporting on – these legislative developments as they occur. Stay tuned!