“Everybody said this was going to be a great, great year to be in the (Louisiana) Legislature,” said State Rep. Les Farnum, wryly. “We’ve got plenty of money, things are good. What can go wrong?”
Farnum spoke to the Sulphur Rotary Club about the budget shortfall, casinos and tort reform at the club’s weekly meeting Wesdnesday.
The regular session began March 9, just two days before a state of emergency was declared due to the coronavirus. “Things started to go south at that point,” he said. The state suffered a shortfall of around $132 million due to virus-related revenue losses. Farnum said the 2021 budget projections are even more dire — hovering around a $900 million shortfall.
“It’s a good probability that we’ll go into another special session in October,” he said.
One of the larger blows to the economy has been the loss of casino revenue. Farnum said gaming revenue accounts for around 10 percent of the state’s annual budget. “In about a six-week period, we were down about $125 million,” in casino revenues.
Farnum said he thinks the three local casinos are now “making a pretty good run at it” as far as operating with only 50 percent of their customer capacity. He noted the grocery stores are “carrying the load, so to speak,” in bringing in sales taxes. “All their revenues are quite significantly higher,” he explained.
Farnum said both the budget and capital outlay bill were put on the back burner to be dealt with in the October special session. He said there was some work done by the Joint Legislative Committee on Capital Outlay.
Stuart Bishop, committee chair, worked to clean up the capital outlay bill with which the Legislature will grapple. “Never, ever, has there been an HB2 come out that you could actually fund the projects that were in it,” said Farnum. “Chairman Bishop took a bold move and took out every splash pad, every little political favoritism project across the entire state. He even wiped out a Girl Scout project that was on private property. If it’s not infrastructure, clean water ... it’s not going to get funded in that bill as long as he’s chairman.”
Farnum said he is pleased with the Legislature’s tort reform efforts, which were codified after approval from Gov. John Bel Edwards earlier this month.
The issue of tort reform has come before the Legislature every session for more than two decades. It was finally addressed this year. The law lowers the state’s threshold for jury trials from $50,000 to $10,000. It also limits medical costs and may even help reduce insurance premiums by making the state more attractive to insurers.
Farnum said the law prevents residents from naming insurance companies in lawsuits, except under special circumstances. It also allows whether or not the victim was wearing a seatbelt to be considered. “We were real proud that actually got signed by the governor,” he said.
The law is effective January 1, 2021.