As prepared for delivery:
Thank you, Lt. Governor, for the introduction and for being here today.
I want to give a special thanks to Dr. Joseph Savoie and the entire University of Louisiana, Lafayette team for their hospitality. They have worked extremely hard to make this event happen, and I can’t thank each enough.
To all the lawmakers here today, thanks for making the trek from all around the state. I know this isn’t quite the opening session venue we’re all used to, but I figured you wouldn’t mind a little change of scenery before getting back to work.
I want to thank all of our university leaders, health care leaders, law enforcement, and local elected officials for joining us as well.
Finally, and most importantly, thank all of you, the people of Louisiana, for being here.
Usually, when we begin a session, I deliver an address in the House Chamber to the legislature. This time, I came here to speak directly to you.
Honestly, the climate in that building in Baton Rouge has not been producing the results that you deserve, and I know you are frustrated by that. And who could blame you?
The decisions that are made inside the Capitol affect those of you outside of it. They affect all of us, so it just made sense to come here to talk about what lies ahead.
It is important for elected officials to get outside of that place as often as we can and interact with the people directly affected by the decisions we make. That is why we are here today, and it’s why I invited every single legislator to be with us in a place like this instead.
My hope is that we can shake the divisive partisanship that’s begun to take root, put aside our differences, and put in place the solutions the people of Louisiana deserve. Now is the time to be Louisianans first and foremost.
While the budget is important to me in my role as governor, I know it’s more important to you as citizens of Louisiana. And as you might have seen from last week, I made the tough decision to veto the budget the legislature sent me, which certainly should not have come as a surprise to anyone.
The House of Representatives and the Senate passed wildly differing budgets. One completely decimated health care in Louisiana, the other funded health care but decimated higher education and other critical state services like education and public safety, while ignoring that a nearly 25 percent cut to our state agencies would leave thousands of our fellow Louisianans out of work and our agencies unable to do their work.
In my opinion, and the opinion of many members – both Republicans and Democrats – that budget proposal was not worthy of the people of Louisiana. Simply put – the cuts were too deep, too wide, too catastrophic.
We must do better.
Because it’s your healthcare. Your hospitals. Your loved ones who are on waivers or in nursing homes. Food on your table. Your TOPS. Your college education. This isn’t about me. It’s about all of us. This is “Our Louisiana.” And our people and our state are worth fighting for.
In fact, I chose to come here today because UL-Lafayette is one of our many universities that could face a catastrophic cut, but not far from here is a community and technical college that is also facing funding cuts.
Just down the street from here is Lafayette General. Come July 1st, if we don’t fix this problem, that hospital may close. And it won’t be the only one. Whether you’re in Lake Charles, Baton Rouge, New Orleans, Bogalusa, Alexandria, Shreveport, or Monroe – our partner hospitals that have already faced two years of cuts, would be forced to close should we not maintain adequate funding. And for those of you that think that this just means the poor and uninsured would lose care – think again.
When these hospitals close; they close for everyone in the community.
As students have been walking across the stage to receive their high school diplomas this month, many of them have also been wondering if they’ll be able to afford their college education come August should TOPS not be funded.
Sadly, some of our best and brightest decided they could not risk that scenario and reluctantly accepted scholarships from schools outside Louisiana. I don’t know if we will ever get them back. But I can tell you we’re gonna fight like hell to try.
Tonight, the legislature will convene a special session that I called in order to fix what we’ve been referring to as the “fiscal cliff.” Let me remind you how we got here. When I took office in 2016, I inherited a $2 billion budget shortfall. Rather that make permanent, long-term reforms, the legislature passed temporary revenue measures that expire very soon – just about six weeks from today. Now, this isn’t the first opportunity the legislature has had to fix the cliff. But we’ve now seen how ugly inaction can be, and it’s time to look to the future – not to the past.
What makes this special session different is that we’ve reached the end of the road. This is it. On June 30th, $1.4 billion in temporary revenue that has been funding all those critical priorities we just talked about goes away. It will be gone. That’s not a number that I or anyone in my administration has created.
That’s number, $1.4 billion, comes from the Legislative Fiscal Office. The Revenue Estimating Conference, a committee of economists and legislators that is tasked with determining how much money we can spend each fiscal year, has estimated the state general fund shortfall is $648 million, meaning that we don’t have to replace all of the expiring revenue, just a portion. Maintaining the $648 million will allow us to adequately fund all of our critical priorities and result in a net tax cut of $400 million for the people of Louisiana.
Let me say that again – we are not seeking to replace all of the revenue that we are losing, just a portion.
Removing the politics, and looking solely at the issue before us, who would not jump at the opportunity to fully fund our partner hospitals, our medical schools, TOPS and Go Grants, corrections and law enforcement, the National Guard, higher education, the department of agriculture and our state parks, and at the same time reduce the tax burden on the people of Louisiana by $400 million? Who? This shouldn’t be so hard.
I talk a lot about the incredible momentum being felt throughout this state right now. We are well on our way to some of the most prosperous days we’ve seen in decades, but we threaten to stop it by not acting right now. This is what that momentum looks like:
Just last Friday, the Bureau of Labor and Statistics at the U.S. Department of Labor announced that employment in Louisiana hit an all-time high. More people are working in Louisiana than ever before.
After years of so much budget instability, we ended the last fiscal year with a surplus instead of a deficit.
Unemployment is at a ten-year low.
In 2017, Louisianans took home more in their paychecks than they did in 2016.
When wage growth at the national average was at 2.4 percent, Louisiana saw 2.9 percent wage growth.
We’ve faced some challenging times in this region and in other oil- and gas-producing regions of Louisiana.
And we’re immensely proud of the resiliency our workers and companies have shown, and continue to show, as they fight to bounce back. The momentum we’ve been building doesn’t mean we’ve reached the finish line. We’ve still got a long road ahead, but these signs of improvement show that we are moving in the right direction.
Medicaid expansion is improving health outcomes, generating $3.5 billion in economic activity in our state, supporting 19,000 jobs, all while saving us more than $300 million. Just last week, I was leaving an event and a young man came up to me in tears. He was diagnosed with cancer and is now receiving treatment because we made the bold decision to bring our federal tax dollars home to help our people. It’s stories like his that reaffirm my belief that expanding Medicaid was the easiest big decision I could possibly make for Louisiana.
For the first time in a decade, we stabilized funding for higher education. This helped us land the biggest economic development deal in Louisiana’s history with DXC Technology. What helped us beat out other states, like Tennessee, was our commitment to higher education and the partnership we were building between the company and higher education institutions across Louisiana.
That’s just one example. We’ve been making bigger, better economic development announcements than ever before, and we’re being innovative in the approach to luring companies to Louisiana – not with massive giveaways, but with partnerships with higher education and a commitment to fund the programs that will train the men and women who will fill these good-paying jobs. It’s all part of our effort to expand opportunities and diversify our economy, like making Louisiana a hub for new technology companies.
And today, I’ve got another one for you. Right here in Lafayette.
Back in 2016, we unveiled the new 50,000-square-foot information technology center here on the campus of the University of Louisiana, Lafayette with CGI’s IT Center of Excellence. The $13.1 million facility promised 400 direct, high-quality jobs and an annual payroll that exceeds $22 million. In March, we announced that they had met their commitment, hiring their 400th employee.
Well today, I’m happy to announce that CGI has extended its commitment in Louisiana for an additional three years, through 2027, and in addition to retaining the 400 direct jobs currently in place, has committed to hire an additional 400 good-paying, high quality jobs by 2023 in Acadiana.
Statewide, CGI will employ 900 people, with 800 of those working at the company’s Lafayette locations.
This partnership would not have been possible but for our commitment to higher education in general, in particular to UL-Lafayette, and its ability to train the employees CGI needs to fill these positions.
By extending our partnership with CGI, we all win. We bring the leading jobs of tomorrow to our state, we triple the number of computer science graduates here at the university, and we secure good growth for Acadiana, and Louisiana.
We did all this together. We didn’t do it as Democrats. We didn’t do it as Republicans. We did it because we all want our Louisiana to be the best place in the best country to raise a family, to get an education, to find a good paying job, have a rewarding career and to take care of our loved ones.
Over the next two weeks, we have a chance – our last chance – to make the responsible choice to solve a problem that has for too long now held us in limbo – a problem that we have seen coming for two years.
I see this as an opportunity to fix things in Louisiana. We’ve got to look at the situation for what it is – an unnecessary road block between the Louisiana people have sadly come to expect and the much better one they deserve.
We’ve got to stop living crisis to crisis if we want to make the progress the people of this state want and need.
As leaders, we can’t continue to talk about moving Louisiana forward, if we’re going to continue policies that keep us at the bottom of all the good lists and the top of all the bad lists. We’ve got to change it up.
We must hit the reset button now and stabilize our state so that we budget responsibly and allow our revenue to grow with our economy so that going forward we can transform our state.
For example, with the right approach, we could finally give our teachers a long overdue pay raise.
We could grow our early childhood education programs, so that children are better prepared for the future.
We can finally reinvest in higher education rather than merely protect them from cuts year after year. When you leave today, I urge you to take a moment and look around campus. We have some of the most beautiful, well-regarded schools in the country. The students who go to them and the faculty who work there are proud of their schools. Just look around this gym. This is the spirit that fuels our Louisiana.
We have the fifth lowest tax burden in the entire country, but one of the most complicated tax systems. We can change things – starting today – and continue to lure business and investments and jobs to our state.
There’s nothing harmful about our business climate, except that we’ve made our system so unpredictable. We can change that.
We have to get this done.
I am confident that we can and I am confident that we will.
From the most progressive Democrats to the most conservative Republicans, there was near universal support to do better by and for the people of Louisiana. That’s why I know this special session can be different from all the others.
We are on the same page. We want the same things.
But it won’t be easy.
The options before us have not changed. We had a legislatively-created task force study our tax and budget system and tell us what we need to do. So, here’s what I am proposing.
We cut the sales tax from its current rate of 5 percent.
In 2016, the legislature temporarily approved a 1 cent sales tax increase that is set to expire on June 30th.
This makes up the bulk of the fiscal cliff. While I would rather do away with the additional penny of sales tax altogether, I’m willing to meet in the middle, which still reduces the sales tax and cuts the 5th penny at least by half.
The four existing pennies of sales tax have over 180 exemptions on them. To make matters worse, each penny is taxed different. That goes against every best practice model out there. Let’s simplify the system, reduce the number of tax exemptions that we hand out, and make this entire process easier for businesses.
Simply put the four pennies we keep should look like the fifth penny we created.
As we reduce these exemptions, let’s keep our sales tax as one of the least regressive in the country by keeping in place exemptions for groceries, pharmaceuticals and utilities.
Now, this one should be a no-brainer. We’re one of only 5 states to allow this in the entire country, and every economist out there agrees it doesn’t make any sense.
Let’s eliminate the ability for an individual to deduct what he paid in state taxes last year, on this year’s return.
This proposal is supported by both Democrats and Republicans. Let’s come together to make it happen.
Finally, lets remove the expiration date from the savings created in 2015 when we reduced the cost of tax expenditures related to tax credits, deductions and rebates.
Making these changes would also allow us to make strategic spending cuts to state government, on top of the more than $600 million in state general fund spending cuts my administration has already made.
And yes, we can do all of this, and still reduce the tax burden of the people of Louisiana by $400 million.
That’s a pretty good deal. And I think most people would agree. But there are other options, and I am willing to listen, which is why I purposefully made the call for the special session broad.
I’m flexible with how we go about doing this. Louisiana is best served when we come together and listen to one another, which is what I have been willing to do all along, but what I can’t accept is disagreement just for the sake of being disagreeable. You shouldn’t either.
Now, I came here so that I could speak directly to you, the people of Louisiana. And by now, I know many of you are wondering what you can do to ensure your voices are heard.
Being here is a great start, but it’s just a start.
The next thing you can do is contact your legislators. Give them a call and tell them you support a responsible plan to fix the cliff. Tell them you support a plan to cut taxes by $400 million and fund our critical priorities. I understand it can be intimidating to call an elected official, especially if you’ve never done it before. I get it.
But I was once a legislator, and there is nothing that influences a legislator more than hearing from the people he or she works for. If you believe, like I do, that our state is worth fighting for, then it is certainly worth it to pick up the phone and let your legislators know that you expect us all to work together to responsibly fix this cliff looming before us.
If you’re wondering how to contact your state senators and state representatives, visit OurLouisiana.org.
And, as always, I ask you to pray.
This is a challenge. But it is also a tremendous opportunity.
I am genuinely excited about what’s going to happen over the next two weeks. Because I believe we will come together to solve these problems once and for all. But more importantly, I’m excited about what’s going to happen as Our Louisiana continues to prosper over the coming months and years.
One last time, we have a chance and we have a choice. Will we seize this chance to keep this train on its tracks, or will we make the choice to fall off the fiscal cliff?
Will we seize this chance to continue to fund higher education, or will we make the choice to go back to the way things were, with cuts putting our children’s future in peril?
Will we take this chance to fund our medical schools, partner hospitals, and law enforcement, or will we make the choice to suffer the disastrous effects on our physical, mental and economic health that will come from hospital closures and the loss of medical training?
I choose to look to the future – to Louisiana’s future. I’m looking to make this the state we want it to be.
This is our home. This is our Louisiana.
Let’s get the job done.
God bless you, God bless the United States of America, and God bless the great state of Louisiana.