The Legislature will likely hold a special session next month to address Louisiana’s property insurance crisis, Senate President Page Cortez said Saturday.
State leaders are grappling with how to get property insurers into the state and reverse the trend of firms fleeing or going out of business after multiple hurricanes hit in recent years.
Cortez, a Lafayette Republican, said he plans to meet with Gov. John Bel Edwards, possibly Wednesday, to finalize plans on the need for a session and when it would happen.
“I don’t think any of us have a different solution,” he said.
The Senate leader also said he thought it could be finished ahead of Mardi Gras — a vacation and celebration time statewide — since the meetings would likely be limited.
“I think the idea is it is really one appropriation bill,” Cortez said.
The session may take place in early February and the aim would be to limit it to about five days.
Another factor is the Washington DC Mardi Gras, which takes place at the end of January and attracts a large number of state politicians.
Edwards’ office did not respond to a request for comment.
The 2023 regular legislative session starts on April 10.
State Insurance Commissioner Jim Donelon has been pressing for a special session since late last year.
Donelon, a former House member, said he wanted to re-launch an incentive program to lure property insurers into the state. The move is also aimed at reducing the rolls of the hard-pressed Louisiana Citizens Property Insurance Corp., the state-run insurer of last resort.
Those policyholders are facing huge rate hikes.
A similar plan was started after Hurricane Katrina hit in 2005.
But in December, Cortez and other state leaders, including Edwards, were unenthusiastic about a special session and said the issue could wait until the regular session.
Cortez said what changed is the view that, to attract insurance companies to Louisiana, they would have to get re-insurance themselves ahead of hurricane season and that process happens in late February or March.
Commissioner of Administration Jay Dardenne, the governor’s chief financial lieutenant, said Saturday the net effect of any legislative action would be to trim the rolls of Louisiana Citizens Property and reduce the cost of re-insurance for firms willing to do business here.
“That is really the name of the game, to reduce the load on Citizens,” Dardenne said.
Donelon has asked lawmakers to let him use $15 million in leftover premium tax revenue to get the incentive program started.
About $45 million total has been discussed, Cortez said.
The program that would pay for the incentives, which the Legislature enacted last year, would be financed with some of the $925 million in excess revenue for the current financial year that the Revenue Estimating Conference recognized in December.
Some lawmakers, including House Speaker Clay Schexnayder, R-Gonzales, have questioned the need for a special session.
“Before we commit to a special session spending $45 million in taxpayer money we need to hear directly from Commissioner Donelon on why this is absolutely necessary right now and what the long-term plan is to solve it,” Schexnayder said in a statement Saturday.
The speaker said Donelon has been invited to appear before the powerful Joint Legislative Committee on the Budget to answer questions when it meets Friday.