Today (Monday, June 29) is expected to be a big day at the Capitol, with action on the State budget, tort reform, and other measures as the Special Session nears adjournment by Tuesday. Here is some of the priority legislation 1A has been engaged on.
Tort Reform to Lower Auto Insurance Rates
Following the Governor’s veto of Sen. Kirk Talbot’s SB 418 from the Regular Session – an omnibus tort reform bill aimed at lowering auto insurance rates – the Legislature advanced a number of measures aimed at achieving the same goal.
HB 57 by Speaker Clay Schexnayder – This bill, known as the Civil Justice Reform Act of 2020, was amended by the Senate Judiciary A Committee and is currently pending in conference committee. In its current posture, it would:
Reduce the jury trial threshold from $50,000 to $10,000
Repeal the seat belt gag order
Prohibit a jury from seeing evidence of an insurance policy for purposes of establishing a direct action against an insurer
HB 44 by Rep. Ray Garofalo – Introduced as an omnibus tort reform bill modeled on SB 418from the Regular Session, this bill was amended by the Senate Judiciary A Committee to remove all provisions except for those addressing the collateral source rule. Specifically, it would:
Limit a plaintiff’s recovery of medical expenses to the amount actually paid to the health care provider, and not the amount billed
HB 66 by Rep. Richard Nelson – Intended as a compromise solution on tort reform to lower auto insurance rates, this bill passed the House 88-8 with strong bipartisan support. It includes the following components:
Prevents a plaintiff found to be over 50 percent at fault from recovering damages for his injuries
Eliminates the jury trial threshold for tort cases, and lowers the jury trial threshold for non-tort cases to $35,000
Creates a six-person jury with the option to request a 12-person jury
Increases the prescriptive period from one to two years
Addresses the direct action statute
Limits the recovery of medical damages to those that are actually paid
Prohibits the use of gender in insurance rate-setting criteria for a driver over the age of 25
Requires a sunset of the bill if there isn’t a 15 percent rate reduction by 2023
Economic Development Incentives
HB 4 by Rep. Tanner Magee – Louisiana’s State Commercial Tax Credit helps encourage the redevelopment of income-producing historic buildings in Downtown Development Districts and Cultural Districts. The program is set to sunset on January 1, 2022, and the original bill would have extended the sunset to January 1, 2028. After amendments in the Senate Revenue & Fiscal Affairs Committee and additional amendments on the Senate floor, the current version of the bill would extend the sunset to January 1, 2026 and set a front-end and back-end cap to limit the State’s fiscal exposure. The bill is currently pending in conference committee.
SB 4 by Sen. Franklin Foil – Louisiana’s Research and Development (R&D) Tax Creditencourages Louisiana-based businesses to establish or continue research and development activities within the state. It provides an income or franchise tax credit on qualified research expenditures incurred in Louisiana of up to 30 percent based on the size of the company. It has been used effectively by Acadiana-based companies like Noble Plastics to pioneer new products and to mitigate the risk of longer-term research and development activities. Extending the sunset of the R&D tax credit from 2021 to 2025 will provide the fiscal certainty needed to allow these multi-year projects to continue. The bill passed both the Senate and House unanimously.
SB 24 by Sen. Jimmy Harris – This bill enhances the State’s Angel Investor Tax Creditprogram for investments made in federally designated Opportunity Zones (OZs). The OZ program was established by Congress in the Tax Cuts and Jobs Act of 2017 to spur long-term private sector investments in distressed areas. 1A is working to promote investment in Acadiana’s 25 OZ census tracts through our Invest Acadiana initiative, and supports measures like SB 24 that align state and local incentives with the federal OZ incentive, in order to make Acadiana’s OZs more competitive for investment.
COVID-19 Workforce Training Response
HB 65 by Rep. Mark Wright – This bill requires short-term COVID-19 occupational forecasts to identify time-sensitive workforce training and education needs. 1A and other regional economic development organizations would provide input, along with quantitative data from various sources and surveys and information from the La. Workforce Commission (LWC) and LED. LWC has committed to produce such COVID-19 occupational forecasts without the need for a bill.
HCR 12 by Rep. Ray Garofalo – This joint resolution urges and requests the Workforce Investment Council and relevant state agencies to compile information on workforce training funds and programs available to support Louisiana workers unemployed due to COVID-19. The study is due to the Legislature by Sept. 30, 2020 and requires at least three public meetings to solicit ideas and suggestions from employers, agency personnel, educators and trainers, economic development organizations, and other stakeholders.
Centralized Sales Tax Collection
HB 14 by Speaker Clay Schexnayder – This bill proposed to amend Louisiana’s Constitution to allow the Legislature to pass laws that would govern a centralized sales tax collection system. Due to concerns from local government stakeholders, Speaker Schexnayder withdrew this bill to allow more time to study the issue.
HR 31 by Speaker Clay Schexnayder – In lieu of HB 14, this resolution calls for a study group to make recommendations to the Legislature on the creation of a centralized sales tax collection system, due by Nov. 1, 2020. It was adopted by the House 97-0.
SCR 19 by Sen. Stewart Cathey – With a broader scope than HR 31, this concurrent resolution would create the Louisiana Sales Tax Simplification Task Force to make recommendations for changes to state and local sales tax laws in an effort to modernize and simplify the sales tax code and enhance the efficiency of sales tax policies for taxing authorities, tax collectors, and businesses. An interim report would be due by March 1, 2021, with a final report due by Feb. 1, 2022. It passed the Senate unanimously 33-0 and is awaiting final passage on the House floor.
SB 10by Sen. Beth Mizell – Reliable and affordable broadband access is one of the key priorities in 1A’s Regional Infrastructure Visioning Report (RIVR). This bill would support expansion of rural broadband access by requiring rural electric cooperatives to grant permission to a broadband affiliate or a broadband service provider to use the electric delivery system of the co-op to provide broadband services. A similar bill that was passed in the Regular Session, SB 406, was vetoed by the Governor due to language restricting where a co-op could have offered broadband services to only those areas that are defined as unserved. SB 10 does not include this limiting language. It passed unanimously in the Senate 34-0 and the House 102-0 with 63 co-authors.
HB 69by Rep. Daryl Deshotel – In January, the FCC established a $20.4 billion Rural Digital Opportunity Fund (RDOF) to support the deployment of high-speed broadband networks in rural areas. The RDOF will operate through a two-phase reverse auction, with the first phase targeting areas defined as unserved – meaning they lack broadband service with speeds of at least 25 Mbps (download) and 3 Mbps (upload). In order to make rural Louisiana more competitive for RDOF bids, HB 69 provides a sales tax rebate of 50 percent of the purchase of fiber-optic cable used to deploy broadband services through the RDOF program. It passed the House 94-3 and the Senate 37-0.