The gist: LCG’s annual audit, presented this month to the City-Parish Council, revealed a worsening trend over the last fiscal year: The parish is out of money, while the city has a generous fund balance.
$0. Unassigned fund balance in the parish general fund.
$46 million. Unassigned fund balance in the city general fund.
General funds hold money that’s not dedicated to a specific purpose. This money is used to cover funding shortfalls in dedicated funds, pay for the operations of LCG, and pay for anything else LCG wants to do.
Unassigned fund balance is the amount of the general fund that’s not already accounted for. Just because there may be money in these accounts doesn’t mean that money hasn’t already been spent. So the unassigned fund balance is how much capital’s actually available to spend.
209. Number of days of operating expenses that could be covered by the city’s general fund balance.
90. Number of recommended days of operating expenses the city’s general fund balance should be able to cover.
0. Number of days of operating expenses the parish general fund balance is prepared to handle.
Sales and property tax revenue growth was effectively zero last year. That means the value of property in the parish and city didn’t increase, nor did the amount of taxable retail sales.
“Thank god we do have the LUS system,” said C. Burton Kolder, managing partner of Kolder, Slaven & Company LLC, the accounting firm that compiled the financial report. He was referring to the fact that the only part of the city’s revenue that’s growing is the payment-in-lieu-of-taxes from LUS and LUS Fiber, which respectively rose from $22.5 million to $23.7 million and from about $400,000 to $600,000.
What to watch for: How these numbers affect the upcoming budget cycle. The city has upwards of $30 million freely available to spend on anything, whereas the parish has literally zero dollars of cushion to make up for shortfalls or do anything new with. While the numbers have been trending this way for a few years, the situation should all come to a head starting this year as the council creates separate city and parish budgets for new city and parish councils in January. If you love tense discussions about financial minutiae, pull up a seat and grab some popcorn.