As voters head to the polls over the next few weeks to vote on Constitutional Amendment #2, they might be wondering what to make of the proposed new “Government Growth Limit.” What is this? Doesn’t Louisiana already have one? Why is it needed and how would it work?

In simplest terms, this is a new provision to ensure that state government spending doesn’t exceed what Louisianans can afford. It’s not just an idea that sounds good; it’s a needed fix to a problem Louisiana has faced for many years.

For many years, even though Louisiana technically has an “expenditure limit” enshrined in the state constitution, lawmakers have routinely appropriated (spent) more and more money—not just on state needs and programming, but also on local projects and donations to non-governmental organizations—even as state revenues were declining, the economy has been weak, and Louisiana’s population has been shrinking. This set up a situation in which lawmakers, in 2016, had to raise state sales taxes just to keep up with their rate of spending. The “temporary” tax increase revenue was intended to gradually offload some state spending and bring the state’s budget back to a more reasonable level. Unfortunately, that didn’t happen. Instead, the state’s budget continued to grow, not only due to an influx of federal COVID pandemic recovery money, but also because of increased spending of state tax revenue—money collected directly from the Louisiana people.

Louisiana’s fiscal year 2025 budget now stands at $47.2 billion, amounting to an increase of 84% over the past decade. This is twice the rate of inflation over the same time period.

 

State funds alone (including the general fund, fees, and dedicated revenues) have increased by 53% over the past decade while the state has simultaneously increased its dependence on federal funds. And all of this while the state’s population and number of taxpayers has decreased. It’s just not sustainable.

Thankfully lawmakers, led by Senator Bob Hensgens and Representative Brett Geymann, and Governor Landry, took action to curb this growth and return Louisiana to a path of fiscal responsibility. In the last legislative session, they passed a measure that voters will get to approve in this upcoming election that will introduce a new and more effective Government Growth Limit (GGL).

The GGL will target recurring spending from the state’s general fund, prohibiting spending that exceeds the state’s rate of inflation and population growth. The restriction would not apply to non-recurring spending (like spending for one-time projects like roads and bridges) and spending from other sources.

Data shows that if Louisiana had enforced an effective overall spending limit over the last decade, spending would be over $3.5 billion lower today, almost enough to eliminate the state’s personal income tax. It’s time to get Louisiana’s fiscal house in order. Our state leaders deserve a lot of credit for starting this process; now it’s up to voters to approve the measure and make this critical limit operational. By reining in spending, Louisiana can get its budget on track, make government more efficient, reduce the tax burden on citizens, and foster a more vibrant economy.