Rep. Hensgens: Louisiana can’t afford to keep spending

When the oil and gas industry was booming in Louisiana, everyone enjoyed spending money, including state government.
Now that the oil and industry is crashing and residents are losing their jobs, oil and gas money is getting less and less.
Residents, who lost their jobs in the oil field, are having to adjust by cutting back spending and doing away with perks.
Rep. Bob Hensgens explained to the Abbeville Rotarians that state government needs to do what Louisiana citizens are having to do - cut spending - because of the decline in the oil and gas industry.
Due to the excess revenue in the oil and gas industry, Louisiana citizens have enjoyed not being taxed by state government.
“We don’t tax Louisiana citizens very much but we spend high,” said Hensgens.
Hensgens explained if Louisianans started paying for their tax burden on Jan. 1, they would have it paid off by mid-March. That’s the second to quickest in the nation, ranking the state 49th in nation on taxes per person. The state is 23rd in spending, he added.
“Our revenue from oil and gas poured in, so we spent more than what we took from ourselves,” he said. “It (oil and gas revenue) is not coming in anymore. We have grown at a rate we can’t keep up. We are going to have decide in the next three or four years, are we a state that spends at 23rd? If we are, we need to tax ourselves as a 23rd state. Or are we as a state going to spend at 49th or 50th? I am fine with either one. The people need to decide.”
The legislators over the next three and four years will have to make tough decisions. Do they cut spending because revenue is down or do they raise taxes to keep funding the programs the state has now?
Hensgens explained that new Gov. John Bel Edwards tried to generate new funds by raising taxes and he did manage to get an extra penny sales tax passed. Hensgens said that he voted for the penny sales tax raise. The extra penny sales tax is only expected to be on the books for 27 months.
“Next year is going to be another difficult year,” said Hensgens. “We need to cut but we also need to get revenue.”
One area the state needs to look at generating revenue is by doing away with certain tax exemptions, he said. The sate loses $880 million a year because of tax exemptions. By getting rid of certain tax exemptions, money would be raised, Hensgens said.
“We have to make a decision with the state in the next few years because we can not keep living in a false world,” he said. “We can either keep all of those programs or not keep those programs. If we keep all of those programs, then we have to raise taxes.”