At a job fair tomorrow at South Louisiana Community College IBM will try to recruit people to move from Lafayette to Baton Rouge with the help with LED.
The gist: Gannett, the publicly traded company that publishes USA Today and The Daily Advertiser, is the target of a buyout by a hedge fund-backed firm known to gut newsrooms. The Advertiser’s faced layoffs in recent years, and the buyout could lead to more.
Digital First Media has offered $1.3 billion in what amounts to a hostile takeover, according to some national reports. Digital First is primarily owned by Alden Global Capital, a hedge fund known to cut costs on troubled assets. Digital First owns 7.5 percent of Gannett already and has made previous offers to acquire the company.
What to cut when there’s nothing left? Denver Post journalists revolted when Digital First took over the Colorado paper in 2018 and cut 30 newsroom staffers. In Lafayette, there’s a dark upside: There may not be much meat on The Advertiser’s bone for Digital First to cut. (In fact, it appears that Digital First’s cost-cutting assumptions could be flawed, according to USA Today.) The Advertiser took it on the chin in 2016 when a few reporters were laid off as part of a 2 percent workforce purge at Gannett properties nationwide. Gannett owns five Louisiana papers, some of which have reduced service to only a few days week.
The Advertiser’s executive editor took early retirement. James Flachsenhaar, a 20-year company man, announced his departure, effective Feb. 1. (Flachsenhaar declined to comment for this story.) The company has pivoted sales messaging to hammer the paper’s value as a community resource, asking customers to buy subscriptions to support the paper’s work. That’s a common approach (one The Current uses, too) as newspapers have struggled to find financial footing on shrinking revenue. The number of working journalists in U.S. has declined about 45 percent since 2004.
“Guess I have to kick ass for whatever time I have left,” veteran Advertiser reporter Claire Taylor wrote in a Facebook post sharing the potential buyout news.
Local journalism in Lafayette is in trouble. It’s unclear whether the buyout will go through or, if it does, whether The Advertiser will suffer the same fate as other Digital First properties. Some analysts believe Gannett will decline the offer. Still, the local media buzz is not positive. But what this really shows is how thin the local reporting ranks are. Lafayette has no mainstream news outlets owned locally. The fate of local information is in precarious hands.
The gist: Since taking office, Robideaux has flirted with smart city initiatives and floated ambitious tech concepts like municipal cryptocurrency. Now, at the end of his first term, he’s seeking a permanent IT director who can help implement his vision.
Robideaux is looking for a visionary: The job description posted last week describes an IT director who would be heavily involved in updating the department, a $9.7 million division that’s primarily charged with tech support services across consolidated government. The expanded role would include a hand in the administration’s smart city programs. Last year, the administration spent $150,000 to develop a smart city roadmap with IBM and mega-consultant KPMG that includes projects like making Lafayette a Smart City test bed, enhancing cyber security, implementing digital payments for government services and Crypteaux. The job posting says the new director would play an “integral role” in the roadmap. You can see the full roadmap here.
“It’s definitely fair to say the position of the director is evolving into one of a visionary and not just a person with a strong tech knowledge base and background,” Communications Director Cydra Wingerter tells me.
LCG’s strategic roadmap envisions more tech personnel. The Smart City roadmap contemplates adding a chief technology officer, a chief data and analytics officer and a chief information security officer. Positions like these do exist in other city governments. But, to be clear, the roadmap is largely provisional. It doesn’t necessarily describe concrete plans, but it offers a glimpse of what the administration has in mind — a more tech-savvy consolidated government.
Finding top talent in an election year could be tough, LCG’s civil service director tells me. Whoever would come into that position would face at least some political insecurity and the possibility that a new boss could kick him or her to the curb, particularly if a new administration doesn’t share Robideaux’s enthusiasm for big data in local government. This is an issue Robideaux faces in filling three other positions in 2019 — directors for LUS, LUS Fiber and planning — all while he runs for re-election.
“The complication is, it’s an election year,” Civil Service Director Adam Marcantel tells me. “Finding someone to run LUS for three months could be difficult. He may find that with IS&T, too.”
Robideaux has typically been slow to fill new positions. Current interim IS&T Director Michelle Rue has served in a temporary capacity for 10 months. Marcantel says he approached the administration in early fall last year to urge action. Caught up in the NextGEN/LUS flurry, the administration asked to revisit posting qualifications for a new director after the holidays. The administration posted the job last week.
What to watch for: Whether Robideaux ultimately fills all four open positions this year, and what talent he’s able to court. Wingerter herself was a late-term appointment in Joey Durel’s administration, she tells me, pushing back on the idea that an election year complicates the search. Technically, there’s nothing other than political pressure forcing Robideaux to make moves on these positions now. Director positions are not subject to civil service rules when it comes to vacancy, Marcantel says.
New county-level economic data from the federal government paints a scary and precise picture of Lafayette’s economic decline.
The gist: Fiber and LUS have been formally split since the budget was adopted last year, but the search for new directors to run the now independent agencies was punted until the NextGEN affair was resolved.
Mayor-President Joel Robideaux intends to fill four vacant director positions this year. Fiber and LUS directorships have been vacant since the fall, when the council approved reorganizing Fiber into its own department. It’s an election year, which could complicate the job search, and Robideaux has been slow to fill other director level positions. LCG also currently has interim directors running the IT and planning departments. LCG Communications Director Cydra Wingerter says the search for an new IT director is starting this week.
Some background: LUS Fiber was created as a division of LUS, not a separate department of LCG. The two shared a director — until mid-last year, longtime LUS Director Terry Huval, one of Fiber’s founders — and shared some administrative staff. As Fiber’s operations have gotten off the ground, it’s built out its own support team. After the split, Fiber became its own department, not unlike public works or planning, and is separate from LUS. Since Huval retired last year, it’s been overseen by Interim Fiber Director Teles Fremin. Jeff Stewart serves as interim utilities director.
OK, so what difference does that make? Many have argued that Fiber has long needed its own dedicated director. The thinking is, it’s a $40 million a year operation that needs full-time attention to grow. That was Robideaux’s rationale when he proposed the split last year, and the council has come on board.
Fiber and LUS are financially intertwined, but the split shouldn’t change that. Fiber owes LUS $28 million for loans fronted by LUS in the system’s early days. Fiber has paid virtually only interest on that debt, but is scheduled to make big payments in the next few years, starting with a $1.5 million payment in 2019. Also, Fiber owes $110 million on bonds that are backstopped by LUS. In other words, if Fiber defaults on its bonds, LUS would be on the hook. Robideaux assured the council that LCG is ultimately responsible for Fiber’s debts, and nothing about the split changes the obligations.
Speaking of the council, the new city council will oversee Fiber once the charter amendments take effect in 2020. There was some question at Tuesday’s council meeting whether the split would swap out regulators. LUS is regulated by the Lafayette Public Utilities Authority, a council subset made up of the five city-majority council members. Establishing a city council negates the need for an extra body. Insofar as the LPUA governed LUS, Fiber was under its purview. But, by state law, Fiber is audited by the state’s Public Service Commission. The PSC, for instance, is reviewing the $1.8 million Fiber billed LUS for service to sewer lift stations that were hooked up but never turned on.
What to watch for: Salaries for the new fiber and utilities directors. Last year, council members Bruce Conque, now LPUA chair, and Kenneth Boudreaux argued Robideaux set the salaries too low: $150,000 for the utilities director and $115,000 for the Fiber director. Qualifications and salary for the utilities director will be set in consultation with LUS’s consultant of record, NewGen Strategies and Solutions (no relationship to NextGEN). But the Fiber director’s salary is up to the administration, subject to approval of the city-parish council this year and the city council in the future. Wingerter tells me the $100,000 salary is not set in stone and could rise depending on candidate interest.
The gist: After months of silence, the Lafayette Public Innovation Alliance finally held its first public meeting. The alliance will function as a trust for investing in innovation projects in Lafayette Parish and could serve as a vehicle for the mayor-president’s cryptocurrency and blockchain aspirations.
With big news at Waitr bookending our first year publishing, beginning with its blockbuster sale to a Texas billionaire and ending with CEO Chris Meaux ringing the Nasdaq bell, 2018 has been a year of extremes.
The gist: Waitr announced this morning that it acquired Bite Squad, an online ordering and on-demand food delivery platform for restaurants, for $321.3 million.
Wasn’t Waitr just bought for $308 million? Yep, that was announced back in May and the deal was only finalized on Nov. 16. So less than a month into being a publicly traded company, Waitr has effectively doubled in size. Bite Squad has more than 11,000 active restaurants, compared with Waitr’s 7,700 restaurant partners as of Sept. 30 of this year.
Waitr gets swoll. With this deal, Waitr’s operations will expand to cover a total footprint of 500 cities in 22 states.
Where’d they get all that cash? Landcadia Holdings acquired Waitr for $308 million, but only $50 million of that was guaranteed cash. At that time, Landcadia Holdings was a special purpose acquisition company — a type of entity set for the sole purpose of buying another company — that had raised $300 million. So when Landcadia Holdings became Waitr Holdings, it still had about $250 million left to fund growth. While this deal for Bite Squad was for $328 million, only $202.1 million of that was in cash with the rest paid with 10.6 million shares of Waitr stock. Plus, to help finance a portion of this deal, Waitr has taken on $42.1 million in debt.
This may only be the beginning. Tilman Fertitta — the billionaire co-owner of Landcadia Holdings, the Houston Rockets and Landry’s Inc. — has a track record of growing his businesses through acquisitions. And Chris Meaux — the CEO and cofounder of Waitr — wants to build Waitr into a billion dollar business. So if I were a betting man, I’d say that this won’t be the last major acquisition they make. And that’s potentially great news for Lafayette.
Am I rich yet? Not unless you were one of the original shareholders. The news hasn’t had much of a net impact on the stock price yet, for those of us who have only been able to buy in more recently. (Disclosure, I own some stock in Waitr.) Yesterday, Waitr Holdings' stock (listed as WTRH on the Nasdaq) ended the day at $11.44. While shares spiked to $12 first thing this morning, they settled back down to $11.48 as of 2 p.m. So I’d hold off on buying that ticket to the moon.
We’re witnessing a changing of the guard, and Waitr’s splash on the NYSE is the latest indicator in the trend.
The gist: If you read the tech blogs, there’s been a big crunch on the crypto market. After a bonkers 2017, the SEC has become a major buzzkill, signaling intent to sheriff the crypto wild west. That could actually make LCG’s crypteaux concept more attractive.
I don’t understand anything you just said. That’s OK. The broad strokes are that Mayor-President Joel Robideaux announced this year that he wants Lafayette to launch a digital currency as an alternative means of public finance. Last year there was a gold rush on the stuff, particularly around Bitcoin, with cryptocurrencies netting billions in profits for investors. There’s been something of a correction in the sector this year, capped off by a ruling by the SEC that initial coin offerings – called ICOs — should register with the federal government and be regulated like any other type of security. Observers have suggested that the developments frosted over what was once the hottest place for investment.
Ok, I understand it marginally better. Good deal. So here’s the thing, lots of people tried to cash in on the cryptocraze. There are digital currencies that support journalism, others that pay cam girls. In Ohio, you can pay your taxes with Bitcoin. The sector attracted a lot of criminal actors and folks that plain didn’t know what they were doing. In a recent talk, Crypteaux architect Joe Castille — perhaps better known as a political consultant, and the ghostwriter of Brian Pope’s demise — characterized the world of crypto entrepreneurship as one lousy with naifs waving white-papers. There’s an argument to be made that the SEC’s ruling will clear out the riff raff like a brushfire, leaving only vetted concepts to thrive in a healthier crypto ecosystem.
Keep in mind that municipal securities are exempt from SEC registration. At least that’s what Investopedia tells me. So while it’s tempting to fear the SEC’s rules on ICOs as a valve closing, in theory a municipally backed ICO could squirt through the regulatory gaps. “Different laws apply,” Castille tells me.
What’s the latest on crypteaux? That’s unclear at this point. Robideaux set up a public innovation trust earlier this year — and put himself on it — but the board has yet to meet. The parishwide trust is a possible vehicle for funds raised in a municipal ICO. LCG recently paid IBM and mega-consultant KPMG $150,000 for developing a Smart City road map that suggests crypteaux and e-residency, concepts championed and researched by Castille, are worth exploring. Castille and his new company, Crypto Research LLC, studies the application of cryptocurrencies and blockchain — a whole other enchilada —in the public sector as a means of addressing budget problems in tax-averse communities. Sound familiar?
Is this crazy? Not necessarily. But it’s a thorny space and one likely to be a tough sell for your average voter. Just because the SEC’s recent crackdown doesn’t necessarily apply to crypteaux doesn’t make the path forward clear.
How Sheriff Mark Garber’s sales tax attempts to solve all his financial troubles in one fell swoop, at the risk of failure.
The gist: The old federal courthouse renovation project appeared doomed last month after council members pounced on purchase provisions that placed the risk of cost overruns on Lafayette Consolidated Government. But new changes to the contract now make the deal an outright $1.4 million sale that requires the development team to pay for sewer upgrades and removing asbestos.
A game changer: That’s how Councilman Bruce Conque describes the revision. The original deal put the $1.4 million purchase price in escrow, with excessive expenses for the project to be paid from that pool of money. In October, Conque and other council members shredded the contract at introduction, fuming that the deal put too much power in the developer’s hands and gave approval of overages to the mayor-president rather than the council. In particular, the deal would take the unusual step of saddling city-parish government with the cost of sewer upgrades needed to accommodate the 68-unit, 25,000-square-foot complex. Developers, in most cases, pay some of the upfront costs for utilities. Downtown and the city’s urban core more broadly are virtually out of sewer capacity.
Kenneth Boudreaux, a perennial no vote on previous attempts to put the city-owned Downtown property back into commerce after years of blight and vacancy, complained that all proceeds from the sale should be “profit.”
The revised purchase agreement appears to hit all major concerns levied thus far: The sale is a lump sum transaction that requires the development team to pay for peripheral infrastructure needs.
“I’m thrilled,” says Conque. “This benefits everyone, and this project can now move forward.
It’s not quite over. Conque and Jay Castille, another staunch opponent of previous redevelopment attempts, will propose two other amendments to the contract, one to prevent the developer from sitting on the project by eating penalty fees against rising costs, and another to require that the facility’s appearance conform to the city’s Unified Development Code. The previous version gave the mayor-president approval of the complex’s facade.
Earlier this year, Mayor-President Joel Robideaux unilaterally selected the team behind the project, led by developer Jim Poche, architect David Weinstein and Ed Krampe, a personal friend of Robideaux's.
Counting chickens: No vote is final before it’s cast, but early indications place the support count at eight. One of the assumed no votes, Boudreaux, will not be at Tuesday’s meeting after announcing health complications associated with a cancer diagnosis earlier this week. With a majority reportedly on board, approval of the contract would be a significant win for Mayor-President Joel Robideaux after months in the doghouse over his pursuit of a deal to privatize management of LUS.