How to vote on those *&$#@ Amendment-2016

It is election time again and, once again, Louisiana voters are being asked to approve 5 more constitutional amendments. Even for me, as a practicing attorney, understanding these proposed amendments can be daunting. So, once again, I will try to make sense out of it and offer some guidance to those who are interested. I do this as a public service, so there is no charge. However, it’s sort of like church. No charge, but all donations gladly accepted. LOL

First, let me reiterate a few things. The current Louisiana Constitution, approved in 1974, is a good one. One of the reasons we had to redo it in the first place was the fact that the 1921 Constitution had been amended so many times it was a mess. We are on the verge of having the same problem. Every election cycle, there are always 5-10 proposed amendments. In my humble opinion, the proposed amendments have more to do with someone convincing their pet project needs to be enshrined in the constitution, and less to do with really needing to amend the original document. Having said that, and in the interest of full disclosure, my default position on these amendments is “No”, unless someone can convince me it is a good idea. With all that in mind, here goes.

AMENDMENT NO. 1: This amendment would establish new requirements for the local Registrar of Voters position in each parish. Under current law, the Registrar is appointed by the local governing body, either the parish council or police jury. The only requirements for appointment is that the potential registrar must be legal resident and registered voter in his/her respective parish. Many times, when a current registrar retires or dies, the parish governing body has 30 days to fill the vacancy, which becomes a permanent appointment. Many people feel that the current law gives and unfair advantage to current employees of the Registrar of Voters office and does not require any educational or professional experience.

The proposed amendment does two things. First, it would establish educational or professional experience requirements for a potential registrar candidate, including: (1) a bachelors degree from an accredited college AND two years of professional work experience; or an associates degree from an accredited college AND four years of professional work experience; or (3) seven years professional work experience; or (4) five years full time employment with a Louisiana Registrars office.

It would also require the parish governing body to properly advertise the office vacancy, interview all qualified candidates and follow all existing procedures for filling a vacancy.

A vote FOR would impose the educational/work requirement and would require the parish to advertise the vacancy and interview all qualified candidates before making the permanent appointment. A vote AGAINST would leave things like they are.

My take: FOR

AMENDMENT NO. 2: This amendment would provide that the governing boards of state colleges and universities can set tuition and fees without approval by the legislature. Currently, the boards which manage colleges and universities in Louisiana can vote to increase fees and tuition. However, those changes do not go into effect unless and until they are approved by the Legislature. Louisiana is one of only two states that require legislative approval of tuition increases recommended by its higher education board. Louisiana requires a 2/3 vote to increase tuition. In addition, the Legislature has cut funding for state supported colleges to the bone in recent years. This is due in part to the fact that higher education is one of only a few budget items that are not constitutionally dedicated.

On one hand, approving this amendment would allow the respective raise needed revenue and meet the respective needs of their students. They would also have to remain competitive in the market. It would allow the colleges to match revenue to respond to increasing costs. On the other hand, opponents argue that the legislature has approved numerous tuition increases since 2007 and likely would do so again if necessary. They argue that it is the ultimate responsibility of the legislature to ensure that all qualified Louisiana students have access to affordable higher education.

A vote FOR would give the respective higher education governing boards the ability to increase tuition and fees, without legislative approval. A vote AGAINST preserve the status quo and still require legislative approval for such increases.

My take: FOR

AMENDMENT NO. 3: This amendment would change the way Louisiana taxes a corporation’s income taxes. It would eliminate the federal income tax deduction for corporations on their state income tax returns and set a flat rate of 6.5% on corporate income. Currently, a corporation paying state income tax in Louisiana can deduct the amount of tax paid in its federal income tax return. Corporations also pay a tax rate between 4% and 8 %, based on the amount of taxable income.

This amendment would eliminate the federal income tax deduction for corporations. It WOULD NOT change the law that allows individuals to deduct such taxes from their personal returns. The amendment is proposed as a compromise for businesses and an attempt to stabilize
state tax revenues. Corporations would lose the federal income tax deduction, but their income would be subject to a flat 6.5% tax. Those in favor of the amendment argue that the reform will broaden the corporate tax revenue, by eliminating the deductions, while lowering actual tax rates. The amendment would also distance our state tax system from the federal system. The legislature has no control over the federal taxes paid by a corporation and changes made by Congress could adversely affect state tax revenues. Those opposed argue that no one really knows for sure how this amendment will effect corporate tax revenue. They further argue that if such a proposal is to be considered at all, it should be part of a comprehensive reform of the state income tax system, including personal income tax and sales tax.

My Take:       Against
AMENDMENT NO. 4: This amendment would give the surviving spouse of active duty military personnel, firefighters and police officers killed in the line of duty a 100% property tax exemption on their home. Currently, homestead exemption provides an exemption for the first $75,000 of assessed value for property tax purposes. Current law also allows the surviving spouse of a service member who died while suffering a service connected disability to an exemption of $150,000.

Those in favor of the amendment argue that granting the exemption, which means the surviving spouse would pay no local property taxes, is a good gesture toward the families of those who have made the ultimate sacrifice. The exemption would help the surviving family financially, while the impact on local taxes would be very small. Those opposed to the amendment agree that the overall effect on tax revenue would be small, but point out that it is part of a larger and growing group of special tax exemption proposals, which taken together will have a negative effect on tax revenue. They also point out that rather than providing these types of exemptions on a piecemeal basis, we would be better served to look at a comprehensive reform of property tax law.

My take: My hear says FOR, but my head says AGAINST

AMENDMENT NO 5:This amendment would create a Revenue Stabilization Trust Fund,
which would receive a portion of corporate taxes and mineral taxes and dedicate the funds to infrastructure and paying state pension liabilities. The state already has a Budge Stabilization Trust Fund, often referred to as the ‘rainy day’ fund. The amendment would provide for an additional fund, using specific funds from corporate taxes and mineral revenues, to be available fund infrastructure projects and pension liabilities when tax revenues fall short of anticipated receipts.

Those in favor of the trust fund point out that part of Louisiana’s annual budget problem is the fact that the Legislature routinely spends every dollar of available revenue each year. This amendment would require the legislature to save some monies from corporate taxes and mineral revenue each year. Using such monies for infrastructure projects and paying down the state’s unfunded pension liability would also free up funds that would otherwise have to be paid from the state’s general fund. In other words, we could pay these liabilities out of savings, rather than recurring income, thereby having more money in the general fund for other purposes.

Those opposed to the trust fund argue that this proposal would further tie the hands of the Legislature to make financial decisions, by creating another stream of dedicated revenue. It removes the discretion of the Legislature over what are currently state general revenues. They also argue that the proposal goes too far. Increasing state savings could be accomplished by reworking the existing Budget Stabilization Trust Fund. They also argue that the proposed fund is not actually protected, since it can be raided in an ‘emergency’ by a 2/3 vote of the Legislature. Faced with the possibility of cutting popular programs, increasing taxes or raiding a dedicated trust fund, taking money out of the dedicated account provides the path of least resistance.

My Take: Against
You can read more about the amendments here: