The legislature adjourned a few days early after a 25-day special session. At the start of the special session, the legislature was faced with addressing four main objectives: emergency declaration powers, the unemployment trust fund, COVID-19 pandemic recovery, and hurricane disaster relief.
There were several pieces of legislation that sought to give the legislature more control of emergency declarations, but surprisingly, HB 4 by Rep. Mark Wright made it to the Governor’s desk. The bill allows the Governor to declare a state of emergency, but not for a period lasting longer than 30 days. Once the 30 days are up, he can renew the declaration, but if either the Senate President or the Speaker of the House determine the renewal does not accurately address the emergency the legislature can vote to remove or alter certain provisions of the order. The Governor vetoed this bill on Tuesday evening.
HB 4 passed with just enough votes, signifying that a veto-proof majority wouldn’t appear to overturn the Governor’s objection. However, the legislative action on this issue didn’t end at this bill. In a surprising move, the House obtained the necessary signatures on a petition to overturn the Governor’s executive order in its entirety, but only for a period of seven days. The Governor has indicated he will not comply, pointing to the effectiveness of COVID-19 mitigation measures and the risk to federal funding that ending the order might create. Ultimately, this stalemate will force the matter to the court system.
Unemployment Trust Fund
The biggest wins this session are SCR 9 by President Cortez and SCR 5 by Senator Reese, both of which protect businesses from the financial consequences of an insolvent Unemployment Trust Fund. SCR 9 suspends the unemployment solvency tax until 60 days after the final adjournment of the 2021 Regular Session and SCR 5 directs the state to use the same tax rates on businesses in 2021 that were used in 2020. This will ensure that the statutory triggers to dramatically increase unemployment taxes on businesses don’t take effect until 2022. The legislature also added $85 million to the Unemployment Trust Fund in the supplemental appropriation that passed, which is unfortunately not projected to last more than a few weeks.
The legislature also approved a supplemental appropriation bill providing funding for a number of entities across the state. Legislators pronounced that this bill was their effort to fund some of the COVID-19 recovery needs of local government that have languished while Congress has been inactive on additional economic stimulus legislation. In the Capital Region, the supplemental appropriation bill has netted $3.2 for the Capital Area Human Services District and $2 million in matching dollars for the Baton Rouge Police Department, an opportunity to take targeted location action to reduce recently rising crime rates.
The legislature came together on measures to assist Southwest Louisiana in the area’s recovery from the recent hurricanes. Approximately $20 million in additional funds were made available to repair damaged government buildings. SB 14 by Senator Johns extends the Louisiana New Market Jobs Act tax credit, designed to spur investment in low-income communities, to areas within the hurricane recovery zones. Lessening the financial burden of replacing lost property, Speaker Schexnayder’s HB 26 created a sales tax holiday on November 20 and 21, formerly a regular practice that was discontinued a few years ago.
The session has ended with some assistance to those affected by Hurricanes Laura and Delta as well as a temporary solution to the Unemployment Trust Fund issues, but very little else. Attention is turning to next year’s regular session or possibly another special before then. BRAC continues its commitment to its investors’ long-standing policy priorities that focus on creating a robust business environment. For coming sessions, BRAC will also examine new opportunities to aid in economic growth and recovery such as reshoring and remote work incentives to attract people and jobs to the region.