Program Authorization: Article VI, Section 4 (D) of the 1974 La. Constitution
This constitutional dedication provides that a portion of the severance taxes collected is returned to the parishes from which the tax is collected. The tax is remitted to the governing authority of the parish in which severance or production occurs in accordance with the following allocations:
1. one-third (1/3) of the sulfur, but not to exceed $100,000
2. one-fifth (1/5) of the severance tax on all natural resources other than sulfur or timber, but not to exceed $500,000; and
3. three-fourths (3/4) of the timber severance tax.
It should be noted that Act 1499 of the 1997 Regular Session proposes to amend Article VII, Section 4(D) of the Constitution of Louisiana, to increase the maximum amount of the severance tax on certain natural resources which is remitted to parish governing authorities. The proposal is to increase the limitation of severance tax allocation on all natural resources - other than sulphur, lignite, or timber - remitted to the parish governing authority from $500,000 to $750,000. This proposed constitutional amendment shall be submitted to the electors of the state of Louisiana at the congressional primary election to be held in 1998. If passed by the voters, the effective date for this change is July 1, 1999. The estimated annual fiscal impact of such a change is a loss of $5.7 million to the State General Fund (Direct). As indicated by the effective date, there would be no fiscal impact until the Fiscal Year 2000.
RESOURCE ALLOCATION FOR THE PROGRAM
This agency's recommended appropriation does not include any funds for short-term debt.
This agency does not have any long-term debt for Fiscal Year 1998-1999.
SOURCE OF FUNDING
The source of funding for this program is statutory dedicated severance tax revenue. (Per R.S. 39:32B.(8), see table below for a listing of expenditures out of each statutory dedicated fund.)
ANALYSIS OF RECOMMENDATION
The total means of financing for this program is recommended at 91.9% of the existing operating budget. It represents 91.9% of the total request ($33,200,000) for this program. The total request was a preliminary number pending the official projection by the Louisiana Revenue Estimating Conference for this constitutional dedication. The conference met on February 18, 1998 and set the Fiscal Year 1999 projection at the recommended level of $30,500,000.
ACQUISITIONS AND MAJOR REPAIRS
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