Lawmakers say the state’s tight budget and tax proposals will be among the top issues in the 2008 Legislature that opens Tuesday.

Soon after convening, members of the Mississippi House will elect a new leader to preside over the chamber for the next four years.

House Speaker Billy McCoy, D-Rienzi, is challenged by Rep. Jeff Smith, D-Columbus. The winner sets the tone of the House and influences legislation. It’s a high stakes gamble for some House members — those who side with the winner will likely draw plumb committee assignments and other important positions.

Also on Tuesday, political newcomer Adrienne Wooten, D-Jackson, will be seated as the representative of District 71 despite the disputed results in her race against Rep. John Reeves, R-Jackson. The House speaker will appoint a committee to review postelection petitions filed by both candidates and make a recommendation to the full body on which candidate to seat permanently.

“A lot of issues take second chair because of the opening day activities, like education, Medicaid and the budget,” said Rep. Bobby Moak, D-Bogue Chitto.

Moak predicted that taxes will dominate some of the discussion during the 120-day session.

Gov. Haley Barbour has created a public-private commission to examine the state’s tax code. Barbour has said Mississippi’s tax structure should be equitable for all incomes, but still generate enough revenue for government operations.

“The governor’s tax study, I suppose we’ll look at it. Some of us want to move forward with the grocery tax legislation,” said Moak.

Proposals to lower the state’s 7 percent grocery tax, the highest in the nation, and increase the 18 cent excise tax on cigarettes have failed in the past two years. Barbour vetoed bills in 2006. Earlier this year, the legislation died in the committee of former Senate Finance Chairman Tommy Robertson, R-Moss Point, who lost re-election.

Rep. George Flaggs, D-Vicksburg, a member of the legislative budget-writing committee, doesn’t believe it would be a good idea to reduce the sales tax on groceries because of the state’s slow revenue growth.

However, Flaggs said he would support raising the tax on cigarettes by at least $1 to help fund Medicaid, which is facing an $87 million deficit in the current year.

Sen. Billy Hewes, R-Gulfport, said a more prudent approach to the tax issue is to wait for the governor’s tax study to be completed before “taking a look at income tax. Maybe a break there would make a lot of sense, particularly for working families.”

A budget proposal from the Joint Legislative Budget Committee recommended level or reduced funding for most state agencies, but also gave lawmakers about $140 million to spend in the fiscal year starting July 1.

Several agencies, including K-12 public education, colleges and universities had joined Medicaid in requesting significant budget increases.

“The fight among the agencies is going to be simply to keep what they have,” Moak said.

It will be weeks before lawmakers delve into writing the budget for fiscal year 2009. The highlight of the opening days of the session will be the speaker’s race and the assignment of committees in the House and Senate.

Rep. Rita Martinson, R-Madison, and most of the House’s other Republicans have said they’ll vote for Smith, a conservative lawyer who has served on the Judiciary B Committee.

“I believe that Jeff is a person who looks at people’s strengths and puts them in position of leadership that will benefit the whole House and the state of Mississippi,” Martinson said. “I believe (McCoy) could have made better use of people’s knowledge.”

Flaggs, who supports McCoy, said the bitter fight in the House is indicative of the partisanship that now defines Mississippi politics.

“I’m not surprised that the candidates for speaker and supporters on all sides are calling today, trying to drum up support at the last minute,” Flaggs said Monday. “What happens now is apparently you have some people that expressed support on both sides.”