Box 2 is for state tax refunds.  There really isn't any good place on the 1099-G to show this type of payment, which reminds me of the "SPIF's" that employees of car dealerships used to get.  (When was the last time anyone saw one of those?)  Louisiana is trying to make jambalaya but all they have is sardines and tofu, no shrimp or sausage.  They probably should have used the 1099-MISC, Box 3.  Just report it as "Other Income."