Even though it is still October, the fall election season is upon us. This Saturday, Louisiana kicks off a month of elections that will close on November 19th. In addition to the slate of candidates for local and state offices, voters in the Pelican State will also decide on five amendments to their constitution this weekend. As we do each year, NTU tracks these ballot measures in our General Election Ballot Guide in order to give taxpayers a better idea of what they are being asked to vote on.
The one measure with cause for concern is Amendment 1. From our ballot guide;
“Amendment 1 on the statewide ballot would redirect future tobacco settlement funds from the Millennium Fund to the Taylor Opportunity Program for Students (TOPS) scholarship. Additionally, the proposed amendment would permanently extend and place in the constitution a $.04 per pack cigarette tax set to expire next year.”
Generally speaking, state constitutions should be used to limit what kinds of taxation are allowed, and to set limits on the level of taxation. Rarely is the constitution used to set the specific rate. This measure would make it substantially more difficult for voters or the state legislature to reduce their tax burden in the future.
Furthermore, the Millennium Fund is Louisiana’s account to handle Tobacco Master Settlement Agreement (MSA) funds. The primary purpose of the MSA is to offset state Medicaid expenditures related to tobacco use. Amendment 1 would stop using future tobacco settlement payments for health care expenditures and redirect them to a wholly unrelated program. This gets away from the fundamental purpose of the MSA and taxpayers should be wary.
Fortunately, the remaining measures on the ballot are commendable efforts in fiscal responsibility. Amendment 2 would use one-time monies generated by natural resource development to start paying down the billions of dollars in unfunded state pension liabilities. Louisiana has roughly $9.5 billion in legacy obligations from its pre-1988 employee retirement plans. This amendment is an honest effort to meet those obligations without raising taxes. Amendment 3 creates a lockbox around the Patient Compensation Fund, so the legislature cannot raid it at will. Amendment 4, while somewhat confusing, simply sets some useful guidelines for refilling the state’s budget stabilization fund. The last measure is a technical correction.
As we say at the top of our guide, these off-year elections can too often be forgotten amidst the noise of the 2012 Presidential race, or even a classic SEC showdown. Bayou State taxpayers need to be on the lookout and hopefully NTU’s 2011 Ballot Guide can help.