Amid dueling hurricanes and deteriorating race relations, Lafayette Consolidated Government is still trying to navigate a contentious budget process. On Sept. 3 at 1 p.m., both councils will meet for a wrap-up session to vote on most of the major amendments to the budget in preparation for final approval Sept. 17. (Note that the original meetings scheduled for Aug. 27 and Sept. 10, respectively, have been delayed because of the storms.)
The councils have to hash out what has become a pretty substantial list of unresolved issues. At stake in these discussions is nothing less than the future of the city’s quality of life, the parish’s financial solvency, the mayor-president’s authority to make large-scale changes to LCG’s operations, and whether Lafayette’s form of consolidated government can come to consensus on the budget.
To help you weed through all the noise, here is a list of my top 10 unresolved budget issues, in no particular order, that need to be addressed prior to the Sept. 10 vote to approve — or reject — the consolidated budget:
(1) How will the city fund its parks?
Mayor-President Josh Guillory has proposed cutting the Parks and Recreation Department’s budget from $7.1 million to $3.6 million. City Councilman Glenn Lazard has proposed an amendment to restore all that funding. However, rather than it being split 90-10 with the parish like in this year’s budget, Lazard’s amendment would have the city fund 100% of this $3.5 million subsidy from the city’s general fund. If Lazard’s amendment passes, this department will be restored to what it was before Guillory started laying people off. If Guillory’s cuts go through, the recreation centers’ budget will drop from $3 million to less than $1 million, dozens of staff will remain laid off, and every recreation program outside of golf will see significant cuts.
(2) How will the parish pay for its parks?
Guillory has proposed cutting all parish funding for the operations of the parks department. Kevin Naquin is working with his colleagues on the Parish Council to find partners to take responsibility for operating and maintaining all parish parks, with the goal of getting parks management off parish government’s books. But these deals will take time to be put into place, and it’s likely there will still be at least some parish parks that remain under the purview of parish government come Nov. 1 when the new fiscal year starts. In Guillory’s proposed budget, that means one of two things will happen: either all utilities will be turned off at these parish parks on that date, or Guillory is proposing the city pay for the parish expenses. The only problem is the city can’t pay for the operations of these parish parks, as the city’s millage dedicated to parks specifically says that it can only be used to pay for expenses for parks located in the city of Lafayette. This issue may get resolved with an amendment; LCG’s CFO Lorrie Toups suggested at the budget review meeting that the Parish Council reallocate the $40,000 that’s in the budget for capital outlay for parish parks to operational expenses. The parish council also has upwards of $800,000 available in its CREATE fund. But it’s not yet clear if, or how, they’re going to pay to keep the lights on at these parish parks until they’re able to reach deals with enough partners to offload these liabilities to someone else’s books.
(3) How will the city fund its cultural programs?
Guillory has proposed making significant cuts to all funding from the Community Development Department for arts and culture programs, including the Lafayette Science Museum, the Heymann Center, the Nature Station, the Acadiana Center for the Arts, and arts and culture grants. There has been significant public outcry against this plan, especially as it relates to the Lafayette Science Museum and the Heymann Center. So far the only formal amendment that’s been proposed to undo Guillory’s cuts has come from City Councilwoman Nanette Cook, who suggested adding money into the budget to pay for a fundraiser that can help the Heymann Center and the Lafayette Science Museum generate more donations and greater revenue. The City Council has the money to restore these cuts completely if it so chooses. If Guillory’s cuts go through, the viability of every major cultural organization in the city will be at risk.
(4) Will the mayor-president’s favored staff get raises?
Guillory has proposed giving substantial raises to his chief of staff, Robert Benoit, and his chief of minority affairs, Carlos Harvin. During the budget review, multiple council members expressed concerns about the optics of giving raises to his chosen executives just months after the councils voted to forego 2% raises for all other LCG employees as Guillory’s request. Their argument is that if budgets are tight enough that lower level employees aren’t getting raises, then higher level management shouldn’t be getting raises either. Guillory argued strongly that these staff deserve these raises, and he’s justified them in part by the fact that he’s proposing to lower the overall budget for his office. The councils can choose to eliminate these raises or even eliminate these positions altogether if they do not feel like they’re a good use of limited public dollars.
(5) How will the city and parish split costs for shared services like the mayor-president’s office?
With the council splitting, one of the budget items I expected to garner greater scrutiny are the allocation formulas used to determine how much the city vs. the parish pays for various shared services. That forecast proved true during a budget review session when there was an extended debate between council members about the fairness of the current setup. A perfect example of this is who pays what for the mayor-president’s salary and his office’s budget. Currently the allocation is based on the split of non-dedicated sales tax revenue, which doesn’t make a lot of sense except for the fact that LCG’s CFO Lorrie Toups admitted that some of these allocations were based more on what the parish could afford than what’s fair. Given the current 79-21 split of expenses, Guillory and his office’s staff should only be spending one day a week on parish issues. Some city council members are questioning if that’s fair given that he almost certainly spends more than one day a week on parish issues. Yet the Parish Council is in a bit of a bind; even if it agrees that this allocation is unfair, there’s no cushion left in the parish budget, so any increase in parish expenses will have to be offset with cuts elsewhere to a budget that’s already been cut to the bone. There’s some question whether the City Council will hold the line on this issue in this budget cycle or leave it to be addressed in a more comprehensive way in the future. There’s also the possibility that either council circumvents this conflict entirely. Rather than argue over allocation formulas, one or both may instead simply define how much city or parish funding either council will make available. For example, rather than the City Council arguing that it’s paying too high of a share and the parish council should pay more, the city side could just decide to lower the amount it’s allocating to the mayor-president’s office altogether and either put the ball in the parish’s court to make up the difference or in the mayor-president’s court to figure out how to do more with less within those new budgetary constraints.
(6) What will happen to 311?
Guillory has proposed moving the 311 program from under the chief administrative officer’s budget to LUS Fiber. City Councilwoman Liz Hebert has offered up an amendment to undo that. Guillory has shown repeated interest in finding ways to consolidate IT functions at LCG, claiming new efficiencies. But if this move is made instead of 311 being paid for by city and parish taxpayers, it’ll largely be paid by LUS Fiber ratepayers. 311 is a service that’s supposed to provide value to the entire city and the entire parish, but in Guillory’s plan the burden for covering these costs will fall entirely on the books of a city-owned asset, LUS Fiber. If Hebert’s amendment passes, 311 will revert to the CAO’s office. Doing that may force the Parish Council to make additional budget cuts since it is responsible for 21% of the CAO’s expenses.
(7) How much will it hurt to keep the parish general fund solvent?
Already in this list of unresolved budget issues we’ve identified three different things that could threaten the parish general fund’s solvency: paying for parish parks, paying for the mayor-president’s office, and paying for 311. Remember that the parish general fund is only projected to end next year with a fund balance of around $50,000. So it doesn’t take much to change this budget in ways that could drop that fund balance below zero. Local government can’t pass a budget with a negative fund balance, which means any increase in parish expenses in one part of the budget will require cuts in other areas. But there isn’t much left to cut in the parish general fund, so if any major cuts are required it could eat into funding for essential services like fire protection in unincorporated parts of the parish. The parish has been kicking its financial can down the road, and in the words of outgoing District Attorney Keith Stutes at a budget review meeting, “Congratulations, you’ve reached the end of that road.”
(8) How will decisions get made about city-funded items in shared-cost departments?
LCG’s attorneys claim that any amendments to the budget in departments that receive funding from both the city and parish require approval of both councils. But we ran into an issue with this interpretation when the Parish Council effectively prevented the City Council from spending city dollars to keep city recreation centers open. Fundamentally, the City Council has sole legislative authority over spending city dollars, just like the parish council has sole legislative authority over spending parish dollars. If four members of either council — which is enough votes to override any veto from the mayor-president — want to spend money, they should have the legal authority to do so. Any aspect of our current form of consolidated government that infringes on that authority is potentially illegal. Clearing up who controls what is super important during this budgeting process. That’s because the city authority to control its spending in particular is at risk, which is why the City Council has taken action to hire its own attorney to represent the city’s interests. How these legal battles play out could have a dramatic impact on the budget process. There’s a very real scenario where the City Council determines that it’s in the city’s best interests to not pass any budget that’s developed using a legal framework that prevents the City Council from having sole authority over how to appropriate city dollars.
(9) Will the City Council trust Guillory’s revenue projections?
Guillory is projecting huge drops in sales tax revenue for city government the rest of this year and into next year. The accuracy of these projections has already been called into question as June’s city sales tax collections not only beat Guillory’s projections, they also actually outperformed last year’s June collections. How much the City Council chooses to believe Guillory’s projections could make a big difference in decisions council members make with regards to upholding or undoing his proposed budget cuts. If they’re more bullish about the near-term future of the city’s economy, there’s arguably no need to enact the draconian cuts Guillory’s proposed. Conversely, if city leaders believe in his ultra-conservative projections, it makes it a lot harder and riskier for them to justify continuing to spend money as they have.
(10) Will the councils increase their millages?
Recently Lafayette Parish Tax Assessor Conrad Comeaux broke the news that total assessed property values are down 6.6% in the parish and 4.4% in the city. That means if the councils do nothing, property tax revenues will fall by those percentages. Especially for the parish, that’s a big problem, forcing it to cut another $200,000 from the parish general fund. But the councils have the option to increase millages to offset this decline in property values to maintain current funding levels. It’s not going to be politically popular to raise taxes, but neither is cutting funding for essential services like fire protection in unincorporated Lafayette. The Parish Council has already taken a first step to increase millage rates so that more budget cuts can be avoided. The City Council has not made a move yet, though the city has more options. Rather than offset lost revenue with budget cuts, it could choose to simply tap into its fund balance.
What other major unresolved budget issues are you interested in?
If there are any major issues we haven’t listed here, submit a comment or email me at [email protected]. These budgets are big, complicated documents with a lot of moving pieces. And there’s more at stake this year than perhaps ever before — with the combination of newly split councils, a mayor on a budget-cutting warpath, and an economic recession that has created a very uncertain future for our city and parish. The public doesn’t typically engage in this process in a big way because of its complexity, but this isn’t a normal year. Hopefully, it’s the start of a new era of civic engagement in our community, in which elected officials will listen when the public speaks.