Investigators from the Louisiana legislative auditor’s office arrived at Lafayette Consolidated Government Tuesday morning.
Reached by phone at noon today, Roger Harris, the office’s executive counsel and assistant legislative auditor for investigations, would only confirm his agency is conducting an investigative audit at LCG.
Harris would not say what concerns brought the legislative auditor to LCG this week. “We can’t talk about that at this time,” he said when asked whether the investigation is specific to drainage projects.
Lafayette home builder Ed Francez, who owns one-third of the St. Martin Parish property LCG destroyed early last year when it secretly removed decades-old spoil banks, says investigators from the legislative auditor’s office also knocked on his door today. LCG did the work in St. Martin Parish without Francez’s knowledge, and he is now vowing to file suit in the coming weeks.
Francez says it was obvious to him the investigators had done their homework. “Their questions were specific to my piece of property,” he says. “They seemed to understand everything that went on. Their basic focus was, you own one-third, the city owns two-thirds, and they took your dirt and your trees. It was about that spoil bank project. They didn’t go into any other issues.”
Several federal agencies — including the U.S. Army Corps of Engineers, EPA and FBI — are said to be probing major flood protection projects launched by LCG.
The City Council is currently investigating the tens of millions of dollars spent on drainage projects with a single contractor, Lafayette-based Rigid Constructors.
LCG spokesman Jamie Angelle referred The Current’s questions to LCG’s legal department. City-Parish Attorney Greg Logan did not respond to an email and text seeking comment.
LCG paid Rigid in excess of $60 million over the past year, according to LCG online records. That figure includes $3.7 million spent on the cloak-and-dagger operation to dig up Francez’s bank levees in Cypress Island Swamp over a 24-hour period in February 2022, a project that lacked local and Corps permits and is now the subject of barbed legal battles with St. Martin Parish in state and federal courts and has federal investigators’ attention.
Rather than bid the work in a competitive process, LCG accepted a no-questions-asked, single-page quote from Rigid and ballooned a $390,000 contract into the $3.7 million job in St. Martin Parish. The earlier contract had been awarded in December 2021 to Rigid, the lowest bidder for as-needed excavation work. Asked to produce evidence that it negotiated pricing with Rigid for the spoil banks job, as is required by the as-needed contract, LCG did not provide any documentation.
Legislative Auditor Michael Waguespack’s predecessor, Daryl Purpera, now retired, suggested in an interview last year that the arrangement violated public bid laws.
“If you materially change the original scope of the contract, then you can’t just amend it like that and be in compliance with the bid law. You have to go out and re-bid it,” Purpera told The Current. “And certainly going from $300,000 or $400,000 to $3 [million] or $4 million would be a material change in the contract. So it sounds to me like they’re in violation of the bid law.”
In the days and weeks before that December as-needed contract was signed between LCG and Rigid, Rigid CEO Cody Fortier, Rigid itself and Fortier’s CF LLC each made $2,500 donations to the mayor-president’s campaign coffer, as did another company associated with Fortier, Sunshine Homes LLC, for a total of $10,000, according to campaign finance records. Guillory has denied undue influence in awarding the contract.
Rigid’s work is part of a massive spending plan Mayor-President Josh Guillory rolled out in July 2021. Flush with $86 million in federal coronavirus relief and record local tax revenues, he proposed an unprecedented capital plan that would churn millions of cubic yards of dirt, combining a historic influx of federal, state and local cash. Within a month of that announcement, Guillory and his wife Jamie had formed a heavy equipment rental company, later removing their names from its public filings only to add Jamie’s name back after the company was brought to light.
Guillory has had limited success in court defending his use of quick-take expropriation for drainage projects, with the Third Circuit Court of Appeal ruling against LCG last month in the Homewood case. Constructed on a nearly 400-acre tract after LCG seized property north of Milton from a private landowner, Homewood is the largest detention pond project ever undertaken in Lafayette. LCG’s website estimates its cost as high as $60 million.
For yet another detention pond project along Coulee Ile des Cannes near Scott, the state has been withholding millions in capital outlay funding, largely due to LCG’s unusual decision to allow Rigid to purchase land so the company could keep working — likely violating its cooperative agreement with the state. Led by state Sen. Page Cortez, the Acadiana delegation helped secure tens of millions of capital outlay money for LCG’s drainage projects over the past two years.
Jacques Berry, a spokesman for the Louisiana Division of Administration, says a total of about $30 million in reimbursements are held up, most for Ile des Cannes, itself a $30 million project. When a district court shut down Homewood last year, the state put the breaks on payments for that project, he says. The state also has not released the $1.5 million the Guillory administration told the City Council it was getting for the spoil banks work when the council signed off on an ordinance accepting the money and agreeing to a $500,000 match.
“I think they may have given up on Cypress Island [funding],” Berry told The Current in September.
LCG CFO Lorrie Toups confirmed last year that LCG was notified by one of its consultants that federal ARPA money cannot be used for either Homewood or Coulee Ile des Cannes because the projects did not go out for bid. All of which means LCG is holding the bag for costs it expected both the state and feds to cover.
So far, the state has paid out approximately $19 million on the Homewood and Ile des Cannes projects, with only about $2 million to $3 million going to Ile des Cannes, Berry confirms.
A potential claw-back by the state on Homewood is not out of the question. “We’ve done it before,” Berry says. “I can tell you we are watching the case carefully and certainly wouldn’t move until the courts have had their final say.”
The City Council’s probe is separate and apart from the legislative auditor’s investigation, though both appear to be homing in on the embattled drainage program. In recent months, the council authorized up to $100,000 to hire an independent auditing firm that is also analyzing the potential violations of the state’s public bid laws in awarding drainage contracts and possible violations of the Home Rule Charter. Additionally, the auditors are seeking more information about Guillory’s decision to avail himself of Lafayette Police Department officers for his full-time security, an extraordinary and unconventional practice.
City Council members Nanette Cook and Glenn Lazard, who have led the charge on the council investigation, could not be reached for comment.
It’s unclear how long the legislative auditor’s staff will be in Lafayette, or how long it will take to complete the inquiry. According to his bio page, Harris supervises a 16-person investigative audit unit and has three decades of experience handling fraud and compliance matters as a law enforcement officer, a commercial banker, an investigative auditor and an attorney. He’s been involved in all aspects of fraud and compliance investigations during his career, the bio notes, and “has aided in the prosecution of hundreds of alleged fraudsters.”
The legislative auditor is appointed by a majority of the members of both the state House and supports the Legislature in a variety of ways, including serving as a financial detective when there’s a potential misappropriation of funds. In April 2021, Waguespack, a CPA and former Assumption Parish sheriff who later worked in finance for an industrial contractor, was unanimously elected by members of both chambers.
Guillory is up for re-election this year and so far has drawn a single challenger, Republican attorney Jan Swift. Monique Blanco Boulet, who heads the Acadiana Planning Commission, is also expected to enter the race. Boulet changed her party affiliation from Democrat to Republican in September.