Louisiana House Bill HB603

Louisiana 2016 Regular Session

• Introduced: 3/4/16
• Refer: 3/4/16
• Refer: 3/14/16
• Refer: 5/2/16
• Refer: 5/3/16
• Engrossed: 5/18/16
• Refer: 5/19/16
• Report Pass: 6/2/16
• Enrolled: 6/6/16
• Chaptered: 6/17/16
• Passed: 6/17/16

Caption

(Constitutional Amendment) Establishes the Revenue Stabilization Trust Fund (EN SEE FISC NOTE SD RV See Note)

Impact

The establishment of the Revenue Stabilization Trust Fund represents a significant amendment to state financial management practices. The funds can only be appropriated under specific conditions, such as reaching a balance of over five billion dollars, ensuring that only a portion (up to 10%) can be used for capital outlay projects and transportation infrastructure. This creates a structured approach for budget surplus management, aimed at fostering responsible financial stability while prioritizing state infrastructure.

Summary

House Bill 603 establishes the Revenue Stabilization Trust Fund in the state treasury dedicated to managing and utilizing surplus revenues effectively. This bill mandates that certain excess revenues, particularly from mineral and corporate taxes, are allocated to this fund. Specifically, mineral revenues exceeding an established threshold and corporate tax revenues over a specified amount will be continuously deposited into the trust fund, aiming to create financial stability and ensure funds are available for essential projects when fiscal conditions allow.

Sentiment

The sentiment surrounding HB 603 appeared largely positive, with broad bipartisan support. The proposed fund is seen as a prudent financial tool that can help the state manage its resources better, especially in times of fiscal volatility. Legislators affirm that it is crucial for long-term economic planning, and this structured fund may mitigate the risk of budget deficits and provide a reliable source of funding for vital state projects.

Contention

While there was significant support for HB 603, the discussions highlighted some contention regarding the constraints on using funds from the Revenue Stabilization Trust Fund. Some legislators raised concerns that limiting appropriations to a strict percentage might hinder responsiveness to emergencies or urgent funding needs. Critics argued for a more flexible approach to ensure that local and state needs could be met promptly, particularly if unexpected costs arise in economic downturns or during emergencies.