The gist: Rebounding from last year’s belt-tightening, Lafayette Consolidated Government passed an aggressive budget balanced with deficit spending and bullish revenue projections. Lafayette’s city and parish councils made mostly minor changes to the administration’s proposed budget but otherwise unanimously approved it at a meeting Thursday.
$629 million in appropriations were approved for the 2022 budget year, a 3% increase over the current budget, which featured heavy and controversial cuts to arts, culture and recreation programming premised on dire revenue shortfalls that never came to pass. This budget is balanced with $3 million in deficit spending from city reserves.
No margin. Heavy capital spending in 2021, mostly on drainage, wiped out much of the city’s reserves, which began the year with $58 million in fund balance and is projected to end 2022 with $28.4 million. (Historically, LCG budgets conservatively and ends each budget year with more cash on hand than projected.) The pressure was evident Thursday night when CFO Lorrie Toups again pushed back against City Councilwoman Liz Hebert’s amendment to spend just $140,000 in city general fund dollars — a fractional cost in terms of LCG spending — on traffic calming projects and $60,000 in capital funds. Hebert added another $250,000 to the traffic calming pool by redirecting funds the administration intended for the mothballed North Lafayette Redevelopment Authority.
Rising costs. Growing personnel costs, driven by salary increases approved in 2019, will continue to drive rising costs for consolidated government. As proposed, deficit spending from the city general fund will continue over the next five years.
$80 million in capital spending is approved for 2022 across LCG. That nearly doubles 2021’s budget, but is comparable to previous one-year appropriations. The Durel administration spearheaded $108 million in 2016, and $86 million was the largest one-year capital plan in the Robideaux era. In a five-year capital spending plan, only funding earmarked in the upcoming budget year is approved. The following years reflect intent only.
Some capital highlights. Approved 2022 spending in green. Total five-year funding in parentheses.
- University Avenue Corridor - $9.5 million ($17.5 million)
- Citywide stormwater detention - $5 million ($22 million)
- Brown and Moore parks - $5 million ($25 million)
- Bike trails - $1 million ($14.5 million)
- Pedestrian River Crossing - $500,000 ($5 million)
Making it rain on Downtown? The five-year capital improvement plan includes $29.5 million for two new parking garages in Downtown Lafayette, although none of the funding is appropriated in 2022. That’s on top of current funding for repairing the Buchanan and Vermilion garages that already serve Downtown. (Buchanan has been shut down since late 2018.) Downtown is the beneficiary of just under $17 million in infrastructure spending from the city of Lafayette’s share of American Rescue Plan funds, which the councils approved last week.
Drainage, drainage, drainage. Just under $20 million in citywide drainage and stormwater projects is outlined in the five-year capital improvement plan ($5 million approved in 2022) plus $2.2 million in parish projects appropriated this coming year. LCG appropriated $30 million toward drainage in 2021 alone, including $20 million drawn from the city general fund in an emergency appropriation passed after flash flooding in May. That tranche included $5 million for spot dredging the Vermilion River, a project that looks to be on hold for the foreseeable future.
Budgeting with optimism. This budget assumes revenues will continue to grow at the record-breaking levels charted in 2021, driven in no small part by massive federal stimulus. Even with those projections baked in, the administration anticipates a declining general fund, which could impact LCG’s cost to borrow money. That leaves little margin for error. Earlier in budget review, council members raised some concern about the projections but ultimately went along with them.
Fair share. City Councilwoman Nanette Cook won a concession from the Parish Council to share the cost of buying equipment and other capital appropriations for LCG’s IT department. Cost allocation between city and parish government is a key sticking point among critics of consolidation, who argue city taxpayers shoulder too much of the burden of funding LCG. City Councilman Andy Naquin secured an amendment requiring some shared costs to be reported on a quarterly basis.
What to watch for: What the councils do with the rest of Lafayette’s $86 million in ARPA funding. The administration effectively treated Lafayette’s rescue plan money as an extension of this budget, leaning into infrastructure spending. Council members paused the process in early August, splitting the money into separate reserves while awaiting eligibility for the dozens of projects proposed.