As Parish Councilman Josh Carson put it at a recent council meeting, Lafayette Parish government faces a lose-lose proposition. Either raise taxes, without a public vote, at a time when many people are already struggling to pay their bills, or significantly reduce parish government’s capacity to maintain essential services like roads, drainage and public safety.
The parish is in this pickle because, for the first time in decades, the assessed value of property in the parish declined — a pretty substantial 6.6%. This undid the last five years of growth and could erase $3.9 million from the parish budget next year.
But parish government doesn’t have to lose this revenue. State law allows it to increase property tax rates without calling an election to offset drops in revenue to keep essential services going.
Of course, raising taxes without giving taxpayers the opportunity to vote on it, especially when thousands are out of work, is not the way to win a popularity contest in Lafayette. And there’s been a steady chorus of people — most prominently Mayor-President Josh Guillory — preaching the gospel that government needs to live within its means. With people tightening their belts, the slogans go, politicians should be tightening their belts, too.
But that politically expedient rhetoric glosses over the real impact not raising property taxes will have on parish residents. Put simply, there’s no more fat left to cut from the parish’s budget. So if the parish doesn’t raise these property taxes, it’s going to exact a serious cost on the delivery of essential services in the parish.
Big cuts to services most agree are “essential”
Parish roads, bridges and drainage will lose almost $1.2 million next year. The millage dedicated to parish roads and bridges stands to lose almost $650,000, while the one dedicated to drainage will drop more than $500,000 if parish government doesn’t raise taxes. That’s more than $1 million in essential infrastructure work that won’t get done next year.
As a reminder, the parish already faces a backlog of more than $60 million worth of roadwork and potentially hundreds of millions of investment that’s needed to restore and improve our parish’s drainage capacity. So losing this revenue will only add more miles to the backlog.
The millages dedicated to the parish jail and district courthouse will lose almost $700,000 next year if parish government doesn’t raise taxes. But neither the jail nor the courthouse can afford to cut their budgets at all.
Just last year, the Lafayette sheriff sued parish government for not paying enough to properly operate and maintain the jail (M-P Joel Robideaux countersued on his way out). And in years prior, the district judges have threatened to sue parish government for basically the same problem at the courthouse.
Both facilities already pay the bare minimum or less to keep public safety infrastructure operating. And, if Guillory gets his way and the Parish Council allocates $3.5 million to fix the Buchanan garage, there won’t be any savings left to tap into.
That means without tax increases neither the jail nor the courthouse will have any money available to pay for any unforeseen expenses or unexpected repairs for at least the next year and likely much longer.
Less than zero
That’s how much money the parish general fund will have. As it stands, without stabilizing revenue, the parish general fund will lose at least $266,000 next year from the millages dedicated to its general fund. Mind you, the parish general fund is currently budgeted to end next year with a fund balance of only $50,000.
But losses from other dedicated funds — including those public safety taxes — could force another $700,000 in costs on the parish general fund. State law mandates that the parish pay for those operations, come economic hell or high water.
Almost $5 million of the parish general fund’s expenses go to other state-mandated services like the district attorney’s office, the district judges, the registrar of voters and more. These are all essential services that have arguably been underfunded for years and have had to beg to minimize an endless stream of budget cuts due to the parish’s failing finances.
Most of the rest of the parish’s general fund pays for the parish’s share of operating Lafayette Consolidated Government. In theory, the parish could lower those payments, but it’s not clear if the City Council would approve any budget that puts more of the financial burden for operating LCG on the city when many city advocates feel as though the parish already hasn’t been paying its fair share.
Literally the only things left to cut in the parish general fund are funding for the 4-H program, Acadiana Open Channel, and fire protection in unincorporated Lafayette. But even if the Parish Council were to zero out 4-H and AOC — which would cripple an important educational program and end live coverage of parish council meetings — it would still have to cut around $600,000 from the $1.4 million budget for fire protection in unincorporated Lafayette.
The parish has no other viable options
The parish doesn’t have enough savings to offset any of these potential losses of property tax revenue. Technically, the parish does have the capacity to sell bonds, but taking on debt to cover operating shortfalls is not sustainable and arguably not a financially sound thing to do, especially at a time of such incredible economic uncertainty.
While some have suggested that voters should get to decide the fate of these increases, that’s not an option either because of timing. The earliest any vote could be put on a ballot is March. And even if the public voted to approve these tax increases, they wouldn’t go into effect until the following year.
So the only real options parish government has are to raise taxes without a public vote or cut $3.9 million from essential services in the parish’s budget and suffer the consequences.
Ball is now in Guillory’s court
The Parish Council voted to approve these millage increases last week by a 3-1 margin after multiple attempts to defer the vote and extensive discussion. Now Guillory has 10 days to either approve the increases or veto them.
This is an extremely tough position for him to be in. He has maintained his philosophical opposition to raising taxes, especially beyond what taxpayers initially authorized without giving them a chance to vote. But he has not yet proposed any plan for how to cut $3.9 million from the parish budget if these taxes aren’t increased. And as we’ve just covered, not raising these taxes will mean having to cut spending on the exact services he has deemed essential — those many would argue are in need of more funding, not less.
Making this situation all the more politically challenging is that the assessed value of residential property actually went up this year. So that means the burden of paying for any increase in property taxes will fall more on residential property than commercial.
I don’t envy either the Parish Council or the mayor-president for being in this position. Saying that government should live within its means is one thing, but forcing the parish to live within a reduction to its already meager means is something else entirely. Whatever decision is made, this may only be the beginning — because we don’t know when, or even if, assessed property values will recover.