Q: What is LFT’s position on Constitutional Amendment 4?
LFT opposes Constitutional Amendment 4.
Q: What would Constitutional Amendment 4 do?
Constitutional Amendment 4 is not a school funding measure. It is a permanent tax-cut measure that would allow a parish to reduce or exempt property tax on business inventory if the sheriff, school board, and parish governing authority all agree. If a parish fully exempts inventory before July 1, 2027, the parish may be eligible to receive a one-time state payment from the Revenue Stabilization Trust Fund, capped at $15 million for an immediate exemption or $10 million for a phase-in. Those funds are then divided pro rata among the local taxing authorities in the parish. Once the election is certified, the exemption is irrevocable.
Q: Why does LFT say that tradeoff is a bad deal for public schools?
That tradeoff is a bad deal for public schools because schools rely on stable local revenue to pay recurring costs: salaries, transportation, utilities, maintenance, insurance, and debt obligations. PAR’s guide says local governments collected about $530 million in inventory taxes in 2023 and warns that eliminating or reducing the tax could shift the burden to other taxpayers and create financial gaps for schools, law enforcement, and infrastructure. According to the Legislative Fiscal Office fiscal note for Act 221, entities choosing the exemption would face an offsetting and “possibly considerable” reduction in revenue in the ensuing years.
Q: What is the biggest problem with CA 4?
The biggest problem with CA 4 is that it allows parishes to permanently shrink part of the local property-tax base that supports schools and other public services. It is a measure to reduce taxes on business inventory, not a measure to protect school funding. That means the long-term pressure does not disappear; it shifts. Local governments may have to ask more of other taxpayers, absorb the loss through cuts, or do some combination of both. The one-time payment may soften the initial impact in some places, but it does not change the larger problem: CA 4 would let businesses contribute less while shifting more of the responsibility onto individuals, families, and local communities.
Q: How would CA 4 affect school boards’ flexibility?
CA 4 also strips school boards of flexibility. The implementing law says the state treasurer pays only after the Department of Revenue certifies that the parish has irrevocably elected to exempt one hundred percent of business inventory. The law also says exempted property will not be treated as taxable property for subsequent reappraisals and millage-adjustment purposes, and any decrease in ad valorem tax collections caused by the exemption must be absorbed by the taxing authority rather than shifted back through those adjustment mechanisms. That means a district is not just losing revenue; it is also giving up an important way to respond to future financial pressure.
Q: Why does LFT say the risk is not theoretical?
The risk is not theoretical. Local examples show how serious the school impact can be. In Lafayette Parish, local reporting said the parish collected $27 million in inventory taxes in 2024, with just under $10 million going to the public school system, about 3% of the district’s budget. Yet the maximum immediate state payment for the entire parish would still be only $15 million, split among all property-tax beneficiaries, and the report said that reimbursement would not come close to filling the total hole.
In St. Charles Parish, a presentation used before a House tax panel showed public school tax collections falling from about $94.8 million to about $82.3 million in an inventory-exemption scenario. That same presentation also repeated a task-force finding that repealing the inventory tax without a replacement revenue source is not a viable option. Those examples help explain why school districts and local governments are concerned: in parishes with a large industrial or inventory base, the losses can be substantial.
Q: How do supporters and opponents frame CA 4?
Supporters openly frame CA 4 as a business-tax and competitiveness measure. The Pelican Institute recommends a yes vote and says the amendment is about flexibility, competitiveness, and local control. LABI’s published policy supports repeal of the local inventory tax with a transition until a replacement mechanism is established. Opponents argue that a no vote keeps school and local-service funding stable and warn that allowing parishes to eliminate the tax could reduce long-term, stable funding and widen differences between communities. In other words, even supporters present CA 4 as a way to reduce taxes on business inventory, not as a way to protect school funding. When businesses contribute less to the local property-tax base, the burden of funding schools and other services shifts more heavily to individuals and other taxpayers, or local governments are forced to cut services.
Q: What does CA 4 not guarantee?
CA 4 does not guarantee that businesses will reinvest their tax savings locally, create better jobs, or replace the revenue local communities could lose. What it does guarantee is that participating parishes can reduce what businesses contribute in local property taxes. Schools and local governments would still have the same responsibilities, but with more pressure shifted onto everyone else.
Q: What is the bottom line for educators?
For educators, the bottom line is simple: CA 4 would let businesses pay less in local property taxes, shifting more of the responsibility for supporting schools and other local services onto individuals and families. A no vote rejects that shift.